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The US is firing back again in the great China chip wars

The US is firing back again in the great China chip wars
  • The Biden administration may impose new sanctions on several Chinese chip firms linked to Huawei.

  • It's also planning to allocate $8.5 billion in grants to Intel to build chip facilities in the US.

  • The moves are all part of US attempts to curb China's industry while boosting its own.

The US took another couple of swings at China in the chip battle between the global superpowers.

The Biden administration is considering imposing sanctions on several Chinese semiconductor firms linked to Huawei, Bloomberg reported on Wednesday, months after the Chinese tech giant unveiled its advanced chip to power a new phone.

Biden announced $8.5 billion in grants to Intel on Wednesday, which would go toward constructing and expanding new chip facilities across the country, The New York Times reported. It's the latest and biggest award the federal government has made as part of the 2022 CHIPS Act to boost US production.

These are the most recent moves by the US in an ongoing effort to curb China's chip industry and push its own semiconductor manufacturing — and AI capabilities — forward. In November 2023, the US Department of Commerce implemented the Advanced Computing Chips Rule, which makes it harder for China to import advanced AI chips from American manufacturers — such as Nvidia's coveted GPUs, which are used to train and power AI models.

But China has also been squeezing the US. Last week, Bloomberg reported that authorities there had started to ask Chinese EV makers to focus their spending on local chipmakers instead of US ones.

And tensions are already affecting US companies. Nvidia has had to ship less-powerful chips to China, hitting its revenue there. Apple's iPhone sales have slumped in China in early 2024 — partly because it's losing out to Huawei.

According to Bloomberg, US officials have no set deadline to make a final decision on Huawei-linked firms. It may depend on the status of US-China relations in the next few months.

Neither the White House press office nor Huawei responded immediately to a request for comment from Business Insider.

Read the original article on Business Insider