In a bold move that underscores the escalating tech trade war between China and the United States, China has implemented stringent guidelines that effectively ban the use of processors from American giants Intel and AMD, as well as Microsoft Windows, in government computers and servers. This decision is a clear indicator of China’s commitment to fostering technological self-reliance and reducing its dependency on foreign technology.
The guidelines, which were discreetly put into action recently after being introduced in December, mandate that government agencies must now rely on ‘safe and reliable’ domestic alternatives for these critical components. The China Information Technology Security Evaluation Center has endorsed a list of 18 processors, which includes offerings from Huawei and Phytium—a state-backed entity. Notably, both companies are on the US blacklist, highlighting the reciprocal nature of the restrictions between the two superpowers.
The impact of these new rules on US companies could be significant. Intel, which saw China as its largest market last year, accounting for 27% of its $54 billion in sales, and AMD, with 15% of its $23 billion revenue coming from China, are poised to feel the financial repercussions. Although the exact proportion of these sales attributed to government versus private sector use remains unclear, the direction of China’s policy is unmistakable.
This move is part of a broader strategy by China to pivot away from its image as the world’s factory and emerge as a global technology leader, as outlined in its Made in China 2025 policy goals. The ban on US CPUs and software in government agencies is a response to the US’s own restrictions on China’s ability to produce advanced chips, including recent bans on the export of advanced AI products from Nvidia.
The US is also taking steps to reduce its reliance on foreign semiconductors through initiatives like the CHIPS Act, which aims to bring chip manufacturing back to American soil. This act of technological tug-of-war is not only reshaping the landscape of global tech industries but also signaling a new era of digital sovereignty where nations seek to fortify their tech capabilities from within.
While the new policies will likely bolster the revenues of Chinese tech firms and accelerate the country’s drive for tech self-sufficiency, they also raise questions about the future of global tech collaboration. As countries increasingly view technology through the lens of national security and economic strategy, the ripple effects of such policies will be felt across the global tech ecosystem.
With the tech rivalry intensifying, the world watches to see how these moves will reshape the balance of power in the tech industry. With China’s latest policies, the message is clear: the race for technological independence is on, and the stakes have never been higher.
