Latest news with #exportcontrol
Forbes
2 days ago
- Business
- Forbes
AI Export Shakeup: Strategic Imperatives For The C-Suite
Claudio Saes is a partner and telecom practice leader at Bell Labs Consulting, a group of the award-winning Nokia Bell Labs. In today's ever-changing technology landscape, regulatory shifts can alter competitive dynamics nearly overnight. On May 13, 2025, the U.S. Department of Commerce rescinded the Biden-era rule for AI diffusion. This export-control policy was designed to impose tiered restrictions on advanced AI chip exports. This policy reversal is set to reshape global AI markets, diplomatic relations and security strategies. As a result, corporate leaders will need to reassess their strategic priorities and risk profiles in real time. From Tiered Control To Targeted Agreements In early January, former President Biden introduced a framework for AI diffusion, classifying countries into three tiers: Tier 1 was most permissive for countries such as Japan, South Korea and Canada; Tier 2 imposed moderate restriction on countries such as Mexico, Brazil and India; and Tier 3 was most restrictive on countries such as China, Russia and Iran. The goal was "to keep advanced computing power in the United States and among its allies while finding more ways to block China's access," per Reuters. The Trump administration is moving away from a broad embargo and appears to be exploring customized bilateral agreements. The New York Times reported that the administration seems to be "interested in using A.I. chips to secure strategic bonds" in the Middle East. If this comes to fruition, this shift could signal a transition to a more streamlined, deal-oriented approach. While it could reduce bureaucratic complications and speed up market entry timelines for hardware vendors, it also introduces some uncertainty. Corporate executives will need to monitor diplomatic negotiations closely, as export privileges may depend on changing agreements between countries rather than fixed, published rules. Revenue Upside And Market Access Chipmakers like Nvidia and AMD now benefit from renewed access to restricted markets. Previous regulations limited exports to Tier 2 and Tier 3 countries, which some said risked the diversion of buyers to non-U.S. suppliers. With these controls rescinded, U.S. firms can gain market share in rapidly digitizing regions like Latin America and Southeast Asia, as well as access the largest AI markets in China and India. Stock markets responded swiftly: Nvidia's share price climbed by 3% on the day of the announcement, reflecting investor confidence in broader global sales prospects. For C-level leaders at technology companies, the challenge now is to recalibrate sales forecasts, re-engage international channels and scale production—while remaining vigilant to potential licensing requirements that might arise under the new bilateral framework. Accelerating Innovation Without Overheating By removing the specter of near-term export limits, we may see a fresh wave of research and development (R&D) investment and product development. Without the looming compliance deadlines and complexity of the tiered structure, engineering teams can focus on performance, integration and customer customization rather than regulatory paperwork. With fewer regulations in place, I believe the speed of AI advancement could surpass companies' ability to properly evaluate and secure their deployments. Corporate strategists need to consider the benefits of innovation against the risks of "overheating" in both market demand and technological development. It is essential to ensure that the rapid rollout of AI technology does not outstrip workforce readiness, graphics or tensor processing units and chipset availability. Diplomatic Ripples And Alliance Management The original tiered system received some pushback from U.S. partners who were assigned to more restrictive categories. By reversing these downgrades, the administration may reduce some political tensions and strengthen certain economic ties; however, not all allies may agree. It's possible that some could push for stricter controls and demand additional safeguards or specific clauses in bilateral agreements. Top executives should keep communication open with government affairs teams to anticipate objections from allies that could result in export vetoes or similar regulations. National Security And Supply Chain Vigilance The Carnegie Endowment for International Peace warned that lifting broad export caps without any type of replacement could result in offshoring AI development in countries that "offer generous subsidies, flexible regulations, and lower wages—but that do not share U.S. interests or values." This could, in turn, allow adversarial states to transform "intelligence and surveillance capabilities," develop "strategically significant weapons" and create "new cyber threats." As a result, corporate risk officers need to intensify supply chain diligence. It's crucial to screen partners and distributors for compliance with temporary licensing regimes, use AI analytics to identify unusual procurement patterns and strengthen internal controls to prevent unauthorized re-exports. Embracing Regulatory Uncertainty The policy reversal has created uncertainty regarding the replacement system. Companies now face a dilemma: Invest in capacity expansion, risking retroactive constraints or wait and potentially lose a first-mover advantage. To address this uncertainty, boards should form cross-functional teams of leaders from legal, finance, sales and R&D to explore different scenarios and develop contingency plans. Flexible contracts with suppliers, tiered hiring strategies and modular manufacturing can help businesses quickly adapt as new regulations emerge. Strategic Imperatives For The C-Suite 1. Reassess go-to-market plans. Update international sales and marketing road maps to capitalize on reopened markets while mapping out potential restrictions under forthcoming bilateral agreements. 2. Strengthen government engagement. Forge closer ties with trade negotiators and regulatory bodies to influence and anticipate the shape of replacement rules. 3. Elevate security posture. Boost supply-chain transparency and compliance monitoring, and consider using AI tools to flag suspicious orders or partner behaviors. 4. Build adaptive operations. Design production and hiring plans with elasticity, so capacity can ramp up or down in response to regulatory fluctuations. Looking Ahead The rescission of the AI diffusion rules marks a crucial shift in U.S. technology policy. The Trump administration said this move was intended to boost American innovation and global competitiveness, but this also raises national security questions and regulatory uncertainty. Executives need to act quickly to seize market opportunities while implementing careful risk management and adaptable strategies for future policy changes. Companies that achieve this balance can thrive in the rapidly evolving landscape of competitive AI innovation. Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify?
Yahoo
16-06-2025
- Business
- Yahoo
Taiwan puts companies behind China's AI ambitions on export control list
Taiwan has added China's tech titan Huawei and chip giant Semiconductor Manufacturing International Corporation (SMIC) to its export control list, stepping up efforts to align with Washington's crackdown on companies driving Beijing's artificial intelligence ambitions. Citing 'concerns over weapons proliferation and national security,' Taiwan's International Trade Administration updated its list of what it calls strategic high-tech commodities entities last week to include Huawei and SMIC, among hundreds of other entities in China, Myanmar, Russia, Iran and Pakistan. Under the restrictions, Taiwanese businesses will be required to apply for permits before exporting to the listed firms. The new rules were announced amid escalating US-China tensions over advanced technologies including semiconductors and AI. Washington has grown increasingly concerned about its tech being used in Chinese military applications. Just last month, the Trump administration restricted sales of chip design software to China in its ongoing trade war with Beijing. The latest move by Taiwan underscores its government's active approach in working with the US – its largest unofficial partner – to plug any loopholes in tech restrictions against Beijing. China claims self-governing Taiwan as part of its territory despite having never controlled it. Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, which supplies Apple and AI giant Nvidia, had produced microchips for Huawei until 2020, when the first Trump administration effectively banned it from supplying the Chinese company. Since the ban, Huawei has turned to SMIC – which has also faced US restrictions – to source chips. With US restrictions already in place, experts said Taiwan's move to tighten the screws on Huawei, SMIC and their subsidiaries is largely symbolic. CNN has reached out to Huawei and SMIC for comment. 'This reflects the Taiwanese government's clearer intent to align its export control regulations more closely with those of the United States,' said Min-yen Chiang, a nonresident fellow at the Research Institute for Democracy, Society, and Emerging Technology, a government-funded think tank in Taipei. 'In fact, Taiwan is the second country in the world – after the US – to publicly place SMIC and Huawei on an export control list.' Taiwan's 'proactive' step signals that the government recognizes the need to play an active role in cooperating with the American government and addressing the security concerns at stake, Chiang said. 'From what I understand, the US government has long hoped that Taiwan would take greater initiative in regulating sensitive exports on its own, rather than simply following Washington's lead,' he added. Late last year, TSMC-made chips were reportedly found in a Huawei AI processor. While TSMC clarified it had not been supplying Huawei since 2020, the report stoked concerns in Washington that chips made by the Taiwanese company and intended for another Chinese firm, Sophgo, might have been rerouted to Huawei. Reuters has reported that the US Department of Commerce has been investigating the incident and that TSMC could face a penalty of $1 billion or more from Washington. In November, the department also ordered the Taiwanese company to halt shipments of advanced chips to China. 'While the new controls aren't a direct response to that specific incident, the discovery of TSMC-made chips in Huawei products last year served as a wake-up call: It prompted both TSMC and the Taiwan government to re-examine existing oversight mechanisms and identify gaps in preventing indirect supply chain loopholes,' said Brady Wang, associate director at Counterpoint Research, a market analysis firm. During his first term, US President Donald Trump imposed targeted restrictions on companies like Huawei, banning American firms from partnering with them and restricting the sale of chips to them. In 2022, then-President Joe Biden intensified these efforts, curbing the sale of advanced semiconductors to China over concerns they could power its military. The controls were subsequently expanded to include restrictions on sales of chipmaking equipment, high-bandwidth memory chips and even products manufactured outside the United States using American technology. The mounting restrictions have put heavy pressure on China's strategic sectors that Chinese leader Xi Jinping has prioritized, including semiconductors and AI. But Huawei and SMIC have made some strides in the production of advanced chips, and Beijing has pinned its hopes on these companies to lead innovation. Although the US restrictions initially crippled its business, Huawei made a remarkable comeback in 2023 with the introduction of its Mate 60 smartphone, powered by advanced chips made by SMIC. The launch of the handset even triggered investigations by the US government. Galen Zeng, a senior research manager at IDC, a market intelligence firm, said Monday that the timing of Taiwan's export controls reflects multiple strategic considerations, including Washington's concerns about the advanced chips found in Huawei's devices. 'Coupled with US concerns over indirect supply routes, these developments have pushed Taiwan to tighten its export control mechanisms to enhance supply chain transparency,' he said. While Huawei and SMIC may need to seek domestic alternatives in response to the export controls, restrictions like these would ultimately benefit Chinese suppliers, Zeng said. 'In the long term, this is likely to accelerate China's push for semiconductor self-sufficiency, benefiting domestic equipment, materials, and component suppliers,' he said. In a rare interview last week, Ren Zhenfei, the founder of Huawei, downplayed the impact of the US technology restrictions on Huawei and China overall, while saying its chip technology remains one generation behind US technology. 'There's actually no need to worry about the chip issue. By using methods like stacking and clustering, the computational results are comparable to the most advanced levels,' he said, referring to the industry approach of bundling multiple chips to achieve higher performance. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNN
16-06-2025
- Business
- CNN
Taiwan puts companies behind China's AI ambitions on export control list
Taiwan has added China's tech titan Huawei and chip giant Semiconductor Manufacturing International Corporation (SMIC) to its export control list, stepping up efforts to align with Washington's crackdown on companies driving Beijing's artificial intelligence ambitions. Citing 'concerns over weapons proliferation and national security,' Taiwan's International Trade Administration updated its list of what it calls strategic high-tech commodities entities last week to include Huawei and SMIC, among hundreds of other entities in China, Myanmar, Russia, Iran and Pakistan. Under the restrictions, Taiwanese businesses will be required to apply for permits before exporting to the listed firms. The new rules were announced amid escalating US-China tensions over advanced technologies including semiconductors and AI. Washington has grown increasingly concerned about its tech being used in Chinese military applications. Just last month, the Trump administration restricted sales of chip design software to China in its ongoing trade war with Beijing. The latest move by Taiwan underscores its government's active approach in working with the US – its largest unofficial partner – to plug any loopholes in tech restrictions against Beijing. China claims self-governing Taiwan as part of its territory despite having never controlled it. Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, which supplies Apple and AI giant Nvidia, had produced microchips for Huawei until 2020, when the first Trump administration effectively banned it from supplying the Chinese company. Since the ban, Huawei has turned to SMIC – which has also faced US restrictions – to source chips. With US restrictions already in place, experts said Taiwan's move to tighten the screws on Huawei, SMIC and their subsidiaries is largely symbolic. CNN has reached out to Huawei and SMIC for comment. 'This reflects the Taiwanese government's clearer intent to align its export control regulations more closely with those of the United States,' said Min-yen Chiang, a nonresident fellow at the Research Institute for Democracy, Society, and Emerging Technology, a government-funded think tank in Taipei. 'In fact, Taiwan is the second country in the world – after the US – to publicly place SMIC and Huawei on an export control list.' Taiwan's 'proactive' step signals that the government recognizes the need to play an active role in cooperating with the American government and addressing the security concerns at stake, Chiang said. 'From what I understand, the US government has long hoped that Taiwan would take greater initiative in regulating sensitive exports on its own, rather than simply following Washington's lead,' he added. Late last year, TSMC-made chips were reportedly found in a Huawei AI processor. While TSMC clarified it had not been supplying Huawei since 2020, the report stoked concerns in Washington that chips made by the Taiwanese company and intended for another Chinese firm, Sophgo, might have been rerouted to Huawei. Reuters has reported that the US Department of Commerce has been investigating the incident and that TSMC could face a penalty of $1 billion or more from Washington. In November, the department also ordered the Taiwanese company to halt shipments of advanced chips to China. 'While the new controls aren't a direct response to that specific incident, the discovery of TSMC-made chips in Huawei products last year served as a wake-up call: It prompted both TSMC and the Taiwan government to re-examine existing oversight mechanisms and identify gaps in preventing indirect supply chain loopholes,' said Brady Wang, associate director at Counterpoint Research, a market analysis firm. During his first term, US President Donald Trump imposed targeted restrictions on companies like Huawei, banning American firms from partnering with them and restricting the sale of chips to them. In 2022, then-President Joe Biden intensified these efforts, curbing the sale of advanced semiconductors to China over concerns they could power its military. The controls were subsequently expanded to include restrictions on sales of chipmaking equipment, high-bandwidth memory chips and even products manufactured outside the United States using American technology. The mounting restrictions have put heavy pressure on China's strategic sectors that Chinese leader Xi Jinping has prioritized, including semiconductors and AI. But Huawei and SMIC have made some strides in the production of advanced chips, and Beijing has pinned its hopes on these companies to lead innovation. Although the US restrictions initially crippled its business, Huawei made a remarkable comeback in 2023 with the introduction of its Mate 60 smartphone, powered by advanced chips made by SMIC. The launch of the handset even triggered investigations by the US government. Galen Zeng, a senior research manager at IDC, a market intelligence firm, said Monday that the timing of Taiwan's export controls reflects multiple strategic considerations, including Washington's concerns about the advanced chips found in Huawei's devices. 'Coupled with US concerns over indirect supply routes, these developments have pushed Taiwan to tighten its export control mechanisms to enhance supply chain transparency,' he said. While Huawei and SMIC may need to seek domestic alternatives in response to the export controls, restrictions like these would ultimately benefit Chinese suppliers, Zeng said. 'In the long term, this is likely to accelerate China's push for semiconductor self-sufficiency, benefiting domestic equipment, materials, and component suppliers,' he said. In a rare interview last week, Ren Zhenfei, the founder of Huawei, downplayed the impact of the US technology restrictions on Huawei and China overall, while saying its chip technology remains one generation behind US technology. 'There's actually no need to worry about the chip issue. By using methods like stacking and clustering, the computational results are comparable to the most advanced levels,' he said, referring to the industry approach of bundling multiple chips to achieve higher performance.
CNN
16-06-2025
- Business
- CNN
Taiwan puts companies behind China's AI ambitions on export control list
Taiwan has added China's tech titan Huawei and chip giant Semiconductor Manufacturing International Corporation (SMIC) to its export control list, stepping up efforts to align with Washington's crackdown on companies driving Beijing's artificial intelligence ambitions. Citing 'concerns over weapons proliferation and national security,' Taiwan's International Trade Administration updated its list of what it calls strategic high-tech commodities entities last week to include Huawei and SMIC, among hundreds of other entities in China, Myanmar, Russia, Iran and Pakistan. Under the restrictions, Taiwanese businesses will be required to apply for permits before exporting to the listed firms. The new rules were announced amid escalating US-China tensions over advanced technologies including semiconductors and AI. Washington has grown increasingly concerned about its tech being used in Chinese military applications. Just last month, the Trump administration restricted sales of chip design software to China in its ongoing trade war with Beijing. The latest move by Taiwan underscores its government's active approach in working with the US – its largest unofficial partner – to plug any loopholes in tech restrictions against Beijing. China claims self-governing Taiwan as part of its territory despite having never controlled it. Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, which supplies Apple and AI giant Nvidia, had produced microchips for Huawei until 2020, when the first Trump administration effectively banned it from supplying the Chinese company. Since the ban, Huawei has turned to SMIC – which has also faced US restrictions – to source chips. With US restrictions already in place, experts said Taiwan's move to tighten the screws on Huawei, SMIC and their subsidiaries is largely symbolic. CNN has reached out to Huawei and SMIC for comment. 'This reflects the Taiwanese government's clearer intent to align its export control regulations more closely with those of the United States,' said Min-yen Chiang, a nonresident fellow at the Research Institute for Democracy, Society, and Emerging Technology, a government-funded think tank in Taipei. 'In fact, Taiwan is the second country in the world – after the US – to publicly place SMIC and Huawei on an export control list.' Taiwan's 'proactive' step signals that the government recognizes the need to play an active role in cooperating with the American government and addressing the security concerns at stake, Chiang said. 'From what I understand, the US government has long hoped that Taiwan would take greater initiative in regulating sensitive exports on its own, rather than simply following Washington's lead,' he added. Late last year, TSMC-made chips were reportedly found in a Huawei AI processor. While TSMC clarified it had not been supplying Huawei since 2020, the report stoked concerns in Washington that chips made by the Taiwanese company and intended for another Chinese firm, Sophgo, might have been rerouted to Huawei. Reuters has reported that the US Department of Commerce has been investigating the incident and that TSMC could face a penalty of $1 billion or more from Washington. In November, the department also ordered the Taiwanese company to halt shipments of advanced chips to China. 'While the new controls aren't a direct response to that specific incident, the discovery of TSMC-made chips in Huawei products last year served as a wake-up call: It prompted both TSMC and the Taiwan government to re-examine existing oversight mechanisms and identify gaps in preventing indirect supply chain loopholes,' said Brady Wang, associate director at Counterpoint Research, a market analysis firm. During his first term, US President Donald Trump imposed targeted restrictions on companies like Huawei, banning American firms from partnering with them and restricting the sale of chips to them. In 2022, then-President Joe Biden intensified these efforts, curbing the sale of advanced semiconductors to China over concerns they could power its military. The controls were subsequently expanded to include restrictions on sales of chipmaking equipment, high-bandwidth memory chips and even products manufactured outside the United States using American technology. The mounting restrictions have put heavy pressure on China's strategic sectors that Chinese leader Xi Jinping has prioritized, including semiconductors and AI. But Huawei and SMIC have made some strides in the production of advanced chips, and Beijing has pinned its hopes on these companies to lead innovation. Although the US restrictions initially crippled its business, Huawei made a remarkable comeback in 2023 with the introduction of its Mate 60 smartphone, powered by advanced chips made by SMIC. The launch of the handset even triggered investigations by the US government. Galen Zeng, a senior research manager at IDC, a market intelligence firm, said Monday that the timing of Taiwan's export controls reflects multiple strategic considerations, including Washington's concerns about the advanced chips found in Huawei's devices. 'Coupled with US concerns over indirect supply routes, these developments have pushed Taiwan to tighten its export control mechanisms to enhance supply chain transparency,' he said. While Huawei and SMIC may need to seek domestic alternatives in response to the export controls, restrictions like these would ultimately benefit Chinese suppliers, Zeng said. 'In the long term, this is likely to accelerate China's push for semiconductor self-sufficiency, benefiting domestic equipment, materials, and component suppliers,' he said. In a rare interview last week, Ren Zhenfei, the founder of Huawei, downplayed the impact of the US technology restrictions on Huawei and China overall, while saying its chip technology remains one generation behind US technology. 'There's actually no need to worry about the chip issue. By using methods like stacking and clustering, the computational results are comparable to the most advanced levels,' he said, referring to the industry approach of bundling multiple chips to achieve higher performance.
The Independent
15-06-2025
- Business
- The Independent
Taiwan adds China's Huawei and SMIC to export control list
Taiwan's Commerce Ministry has added Chinese chipmakers Huawei Technologies and Semiconductor Manufacturing International Corp (SMIC) to its export control list, as trade and technology frictions between the self-ruled island, China and the United States increase. Inclusion on the 'strategic high-tech commodities' list means Taiwanese companies will need to obtain export permits before selling goods to the respective companies. Other entities on the list include organizations such as the Taliban and al-Qaeda, as well as other companies in China, Iran and elsewhere. The export control entities list was last updated on Sunday. Neither Huawei nor SMIC initially commented on their inclusion. Huawei and SMIC have both been sanctioned by the U.S. The two companies are producing China's most advanced homegrown artificial intelligence chips in an effort to compete with U.S.-based Nvidia and supply Chinese tech firms with the much-needed chips amid export curbs. Taiwan is home the world's largest chipmaker, Taiwan Semiconductor Manufacturing Co. (TSMC), a major supplier for Nvidia. Last November, the U.S. ordered TSMC to halt supplies of certain advanced chips to Chinese customers as part of broader efforts to restrict China's access to cutting-edge technologies. China claims self-ruled Taiwan as its own territory, to be annexed by force if necessary. The U.S. is Taiwan's biggest unofficial ally and arms seller.
