The race for global AI dominance has reached new heights as the U.S. and China battle it out for the number one spot. Next year, Chinese chipmakers plan to triple their output of AI chips, according to the Financial Times.
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Beijing is in the process of constructing three chip fabrication plants, which are specialized factories used to manufacture semiconductors.
“Domestic output won’t be an issue for long, especially with all the capacity coming online next year,” said a Chinese chipmaking executive.
China Pushes Domestic Chips amid U.S. Export Restrictions
AI resources are a major bargaining tool in U.S.-China trade negotiations. The U.S. has barred China from purchasing Nvidia’s (NVDA) most advanced chips, pushing Beijing to ramp up its own chip industry. At the same time, President Trump has opened the doors for Nvidia to export its H20 chips, which are specifically designed for the Chinese market.
However, Beijing has encouraged the use of domestic chips and has urged Chinese companies to halt the purchase of H20 chips. This comes after Commerce Secretary Howard Lutnick remarked that the U.S. doesn’t sell China “our best stuff, not our second-best stuff, not even our third-best.”
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