Despite US restrictions, China continues to secure essential tech for AI development

The trade war between China and the United States is also a struggle for technological superiority. Americans understand that high-level computing systems are used not only for scientific research but also primarily for developing artificial intelligence and advanced military technologies.

The effects were quick to surface. In September 2023, Washington hindered the export of advanced graphics systems, including the popular NVIDIA Ampere A100 and Hopper H100 models. In October 2023, weaker models, NVIDIA A800 and H800 were also added to the list, as they could be used for military projects. The idea behind cutting off the supply of the most potent chips was to limit Beijing's potential theoretically. Regrettably, it was only an apparent limit. Reuters reports that the superpower continues to receive chip supplies.

Publicly available tender documentation reveals that China has conducted 100 tenders to purchase advanced NVIDIA A100 and A800 computing systems. These are chips that, in theory, should not end up in China. The recipients of these processors are prestigious Chinese universities and entities with military affiliations. Some tenders specify the purchase of completely new systems.

The question arises: Where does China acquire these prohibited computing systems? The supply chain remains unclear. It's inevitable that these premium chips are not purchased directly from NVIDIA or authorized distributors, as such transactions would be blocked by American law. Journalists speculate that China may obtain surplus stocks from large American companies or import them through other countries, such as India, Taiwan, or Singapore.

NVIDIA stated that they adhere to all relevant export control regulations and expect the same from their customers. "If we discover a client has illegally resold to a third party, we will take immediate and appropriate actions," said a company spokesman.

Chris Miller, a professor at Tufts University and author of "Chip War: The Fight for the World's Most Critical Technology," argues that it's unrealistic to think American export restrictions can be entirely foolproof. Chips are small in size, making them easy to smuggle. China will find ways to acquire them anyway.

Instead, Americans should endeavor to slow down Chinese research that allows for constructing large computing clusters capable of training artificial intelligence systems. As Miller put it, it's akin to "throwing sand in the gears of artificial intelligence development in China."