Is Malaysia’s Chip Sector Prepared for The Storm?
The Edge | 30 January 2025
IN the name of “US national security and economic strength”, the Biden-Harris administration on Jan 13 released an Interim Final Rule on Artificial Intelligence Diffusion. This rule imposes new restrictions on the export of US-developed chips that power artificial intelligence (AI) systems. The announcement comes just a week before Joe Biden exits the White House, ahead of president-elect Donald Trump’s second inauguration on Monday (Jan 20).
The new rule, which introduces a three-tier licensing framework for semiconductors used in data centres handling AI computations, has sent shockwaves through the global semiconductor supply chain.
Countries in the top tier, including Australia, New Zealand, South Korea, Taiwan, the Netherlands and Ireland, face no restrictions. In contrast, nations such as China, Iran, Russia and North Korea are effectively barred from importing AI chips from US companies.
The middle tier, which reportedly includes Malaysia, comprises more than 100 countries subject to export caps and licensing requirements.
The Semiconductor Industry Association (SIA) and Nvidia Corp — two powerful voices in the global chip industry — have strongly criticised the Biden administration’s new export curbs on AI chips.
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