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美国管控新规会否终止AI行情?

Will the new regulations imposed by the USA terminate the AI market?

Baron Chinese ·  Jan 14 23:46

Source: Barron's Chinese
Author: Jin Tai

The soon-to-be-inaugurated Trump administration may take a different approach to AI regulation, so the sell-off of chip stocks may be a temporary phenomenon.

The Biden administration poured cold water on the USA's AI trade in the last week before leaving office.

In the new regulations announced on Monday (January 13), the USA's Department of Commerce set a cap on the number of advanced AI chips exported to certain countries, while imposing additional licensing requirements for the research and development of AI technology.

US Secretary of Commerce Gina Raimondo stated in a press release to the media: "This policy helps establish a reliable technology ecosystem on a global scale, aiding the USA in guarding against national security risks associated with AI, while ensuring that regulatory measures do not stifle innovation or the USA's CSI Leading Technology Index."

Raimondo said that after the implementation of the new restrictions, the USA's "competitors" will not be able to access advanced AI technology.

Compared to the previously announced restrictions, the new regulations issued on Monday significantly differ by extending the export limits, licensing approvals, or caps on AI chips to over 120 countries beyond just China.

Investors reacted strongly to the latest news, with chip stocks generally declining on Monday. Over the past two trading days,$NVIDIA (NVDA.US)$down 3.05%, AI Server memory manufacturers$Micron Technology (MU.US)$down 1.99%.

However, the sell-off of chip stocks may be temporary due to the fact that the incoming Trump administration may take a different approach to AI regulation.

Affected by the restrictions implemented at the end of 2023, investor expectations for NVIDIA's business prospects in the China market have declined. Since then, there have been advancements in AI technology, and the measures implemented at the end of 2023 mean that NVIDIA's long-term revenue from the China market has been restricted.

NVIDIA stated that the Biden administration's new policy is "unprecedented," pushing the USA's leadership in AI to a "dangerous edge."

Ned Finkle, NVIDIA's Vice President of Government Affairs, stated in a press release: "In the final days of its term, the Biden administration attempted to undermine the USA's leadership in AI through a regulatory document of over 200 pages that was secretly drafted without proper legislative scrutiny. Such overreach will impose bureaucratic control over the design and global marketing of the USA's leading semiconductors, computers, systems, and even software."

NVIDIA believes that the Biden administration has made it more difficult for companies in most countries and regions globally to obtain NVIDIA chips, a move that opens the door for China to expand its market share in countries listed on the USA's restriction list. Critics argue that this policy could ultimately make China's AI chips the standard in these countries, thereby consolidating the status of Chinese AI chips.

For NVIDIA, the good news is that the new regulations cannot take effect until after a 120-day public comment period. Based on the opposition to Biden's previous AI executive order and the statements against the cumbersome AI regulations, it is likely that the incoming Trump administration will withdraw or alter these new regulations ahead of time.

In October 2023, the Biden administration issued an executive order on AI under the Defense Production Act, requiring companies to report to the USA government and send test results when developing more powerful versions of AI systems.

During his presidential campaign, Trump made the repeal of this AI executive order one of his core principles, stating in his campaign program: "Joe Biden's executive order is very dangerous, and we will repeal this executive order that hinders AI innovation."

Trump's transition team did not immediately comment on the newly issued AI restrictions.

To align policies with the new administration's goals, Trump may modify all AI chip policies.

When Trump nominated Doug Burgum as Secretary of the Interior at the end of November last year, he stated: "We will win the battle for the AI advantage that concerns USA National Security and prosperity." He also mentioned that the USA would lead AI technological innovation by reducing regulations.

If the Trump administration relaxes restrictions on AI infrastructure development and eases regulations regarding the development of nuclear reactors, NVIDIA's Business may thus receive a boost, as nuclear reactors are crucial for providing sufficient Energy for AI projects over the next decade.

Editor/Rocky

The translation is provided by third-party software.


The above content is for informational or educational purposes only and does not constitute any investment advice related to Futu. Although we strive to ensure the truthfulness, accuracy, and originality of all such content, we cannot guarantee it.
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