China to build giant AI chip factory to bypass US sanctions: Report

Chinese scientists are reportedly considering constructing massive facilities to manufacture the technology necessary to create AI semiconductor chips locally.

China is looking to build artificial intelligence (AI) chip factories for creating particle accelerators to help bypass sanctions affecting the local industry, according to a report from the South China Morning Post (SCMP). 

Using particle accelerators will help create new ways to produce a novel laser source. The SCMP reported that the electron beam of the accelerator will be transformed into a “high-quality” light source needed to manufacture AI semiconductor chips on-site.

According to the report, a team of scientists from Tsinghua University are in discussions with authorities in the Xiongan New Area to select the proper area to develop the factory.

The report said local scientists view this as a way to potentially circumvent current sanctions in place by the United States.

The particle accelerators would be replacing the role of the lithography machine in the steps to produce semiconductor chips for creating high-level AI systems.

At the moment, Advanced Semiconductor Materials Lithography — a company based out of the Netherlands — is the only company that owns the technology for such machines. The U.S. has barred the company from selling its top-end machines to the Chinese market, similar to its barring of Nvidia, the world’s leading manufacturer of AI chips, from selling its most powerful products to China.

The report from the SCMP said the Chinese mega-factory could house multiple lithography machines.

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This is not the first time China has tried to combat sanctions through efforts on the home front.

In May, reports surfaced about Chinese companies studying methods to develop AI systems using weaker semiconductors and different combinations of chips amid U.S. sanctions.

Despite the sanctions, however, Chinese companies have released new AI systems after the country set its landmark AI legislation into motion. On Sept. 7, Tencent unveiled its own ChatGPT rival in the Chinese market.

Meanwhile, the U.S. has been tightening its grip on the AI manufacturing market. In a recent visit to Vietnam, the U.S. made deals worth billions of dollars focusing on AI chips and technology. 

Its weariness of having China take the lead in AI development has spread overseas, with European regulators also considering their stance on export controls and restrictions on China.

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