In a nutshell, we learn that US sanctions are getting tougher. This time, the U.S. is directly targeting high-bandwidth chip and memory production devices. The objective remains unchanged: to prevent China (and other unfriendly countries) from developing their own AI models or upgrading their weapons with American technologies.
Yet another tightening of US sanctions!
This time, the sanctions are hitting hard, as we learn that this third package of sanctions affects around 140 Chinese companies. In effect, as soon as you use American technologies to produce chipmaking devices, you are no longer allowed to export them to China.
In other words, the USA is sanctioning other countries on your behalf. These include Intel in Israel or Malaysia, for example. What’s more, even if allied countries such as Japan or the Netherlands are exempt, the sanctions are so broad that the latter could suffer the consequences while still being exempt.
Here, Uncle Sam is targeting China’s supply of high-bandwidth memory chips. This type of chip is particularly useful in the AI sector, which is particularly greedy for memory and memory bandwidth, especially when it comes to LLM. It’s not for nothing that boards like the H100 are offered with 96 GB of HBM3, or 192 GB in the case of AMD’s Mi300X.
Of course, companies like Micron are forbidden to export this type of memory to the Middle Kingdom. Nevertheless, Samsung and SK Hynix are caught up in the storm. We learn in passing that demand in China is mainly for HBM2E-type memory.
Last but not least, China’s spokesman for the Ministry of Foreign Affairs, Lin Jian, denounced this behavior. Among other things, he stated that this decision “undermines the global economic system while disrupting global supply chains”.
