Despite our restrictions, China is still purchasing our AI chips. We must pray that our weapons are kept away from our enemies.

From The Epoch Times. Despite measures to limit U.S. technology exports to the Chinese military, chips designed by U.S. companies still end up in the hands of the People’s Liberation Army (PLA), according to a report by the Center for Security and Emerging Technology (CSET) at Georgetown University.

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For the report, researchers combed through over 66,000 publicly available PLA purchase records during the eight-month period from April to November 2020 and identified 97 unique, high-end artificial intelligence (AI) chips ordered by the PLA. Nearly all of them were designed by U.S. firms Nvidia, Xilinx (now AMD), Intel, and Microsemi….

To obtain the U.S.-designed AI chips, the CCP has been bypassing the limitations imposed by recent U.S. export controls.

Dodging Export Controls

The Biden administration has maintained Trump-era controls designed to curtail technology exports to military end users in China. These controls, however, don’t apply to items made outside the United States. Since most AI chips are made in South Korea and Taiwan, the end-user controls have very little power to limit purchases from Chinese entities, the report indicates.

Moreover, the Department of Commerce maintains an entity list through which the U.S. government can deny orders placed by hostile entities. About 500 Chinese firms are on the entity list. However, none of the seven Chinese intermediary suppliers (for the PLA) who ordered the 97 high-end AI chips found by the CSET researchers are on the list….

The seven intermediary suppliers are based in Beijing, Tianjin, Zhengzhou, Hangzhou, and Xi’an, and they are affiliated with the Chinese military…

CCP’s Military–Civil Fusion Strategy

Prior CSET research has highlighted that, nationwide, Chinese consumers import the majority of the country’s AI chips overwhelmingly from the United States, Taiwan, Japan, and South Korea.

The CCP’s military–civil fusion strategy is making it almost impossible for U.S. regulators to distinguish between military and nonmilitary end users in China, which is the basis of the majority of U.S. export controls. The fusion model allows the Chinese military to bypass U.S. export controls and have covert access to U.S. technology and equipment through its civil counterparts.

The authors propose that the United States expand its collection of open-source intelligence and adopt new export control measures based on features specific to high-end chips….

“The Chinese market accounts for 25 percent of global AI chip consumption,” the report says, “with AI chips sold to China in 2021 amounting to an estimated value between $2.5 billion and $5 billion….”

Curtailing the CCP’s access to U.S. technology has associated political and economic costs, the researchers point out. Another challenge would be whether, or how, to compensate for the loss of Chinese market access….

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(Excerpt from The Epoch Times. Photo Credit: Alejandro Luengo on Unsplash)