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US extends AI chip export restrictions to Middle East nations

The Biden administration has restricted the sales of Nvidia’s A100 and H100 machine learning chips in some regions outside China, the company has revealed in a regulatory filing.

The chipmaker has revealed that certain types of its artificial intelligence (AI) semiconductors now require licensing agreements to be sold in certain countries of the Middle East, but did not specify which. 

The semiconductors developed by Nvidia power technologies including ChatGPT and other generative AI tools. For this reason, the US has aimed to limit China’s access to the technology, claiming national security concerns. 

“During the second quarter of fiscal year 2024, the US government informed us of an additional licensing requirement for a subset of A100 and H100 products destined to certain customers and other regions, including some countries in the Middle East,” the company said in a statement.

Nvidia added that the controls, which affect its A100 and H100 chips, would not have an “immediate material impact” on the company’s results and stressed the company is “working with the US government to address this matter”.

Nvidia is one of the world’s most valuable companies, with an estimated worth of $1.2tn (£940bn). Its rival, chipmaker AMD, has also reportedly received an informal letter with similar restrictions, according to Reuters.

The US has restricted China’s access to semiconductor tech since at least 2019, when the Trump administration banned Huawei from buying vital US technology. Last year, the US also prohibited the export of four technologies tied to semiconductor manufacturing, citing they were “vital to national security”, and signed a “historic” bill aimed at boosting the domestic production of semiconductors.

In September 2022, the two chipmakers revealed they had been ordered by US regulators to halt exports of some of their AI technology to China to address the risk of semiconductors being “used in or diverted to a ‘military end use’ … in China and Russia”.

In recent months, Saudi Arabia and the United Arab Emirates have announced their plans to buy thousands of Nvidia graphics processing units (GPUs) in an effort to boost the oil-rich states’ tech sectors.

Last year, Saudi Arabia’s communications minister Abdullah bin Amer Al-Sawaha signed a strategic partnership plan with China that included cooperation on AI technologies. 

Since the restrictions began, Nvidia, AMD and Intel have disclosed plans to create less powerful AI chips that can be exported to the Chinese market.