Dieter Ernst

China may forge ahead of the US in AI chip race, but at what cost to both?

With decoupling in trade and technology proceeding apace, China’s focus on this critical component of its hi-tech development reflects a desire to be self-sufficient. But technology warfare based on techno-nationalism benefits no one in the end

Reading Time:4 minutes

Why you can trust SCMP

A chip designed by Huawei’s subsidiary company HiSilicon is displayed at Huawei’s headquarters in Shenzhen in May last year. Photo: Reuters

Dieter Ernst

Published: 1:00am, 9 Apr 2020Updated: 4:51am, 9 Apr 2020

Success in artificial intelligence is not limited to data and algorithms. The third component that determines success in research and applications is advanced specialised AI chips that provide increased computing power and storage, while decreasing energy consumption.

Companies that have access to leading-edge AI chips are essentially in the fast lane, where improvements continue to be rapid and mutually reinforcing.

China has relied almost solely on the United States to import advanced microchips, but the US-China technology war has disrupted China’s access to these critical components of AI success. We are at a turning point: will America’s unprecedented technology export restrictions cripple China’s AI ambitions? Or will it force China to race ahead on its own?

Data arguably constitutes China’s primary AI advantage. With fewer obstacles to data collection and use, China has amassed huge data sets that do not exist in other countries. But, China’s achievements in AI applications lack a robust foundation in leading-edge chips, leaving them vulnerable to imposed supply disruptions, as we’re seeing amid the coronavirus pandemic.

China’s AI strategy has largely neglected the role of computing power as it was assumed that the necessary chips could always be purchased from global semiconductor industry leaders.