Just days after the United States and China agreed to a temporary pause in their tariff battle, tensions are once again rising—this time over Beijing’s most advanced artificial intelligence chips.
China’s Commerce Ministry has repeatedly condemned Washington’s warnings against using Huawei’s AI processors, accusing the U.S. of undermining consensus reached during recent Geneva trade talks. The dispute underscores persistent divisions between the two nations despite last week’s efforts to ease trade restrictions.
At the heart of the controversy are Huawei’s Ascend chips, which are designed to rival Nvidia’s dominance in AI processing. Beijing views their development as a cornerstone of President Xi Jinping’s push for technological self-reliance, yet U.S. officials argue that unrestricted access to these chips could pose national security risks.
Last week, the U.S. Commerce Department issued new guidance advising that using Huawei’s chips could violate American export controls. After backlash, the department revised its statement, removing language suggesting a global ban. But China remains unconvinced, with officials calling the updated guidance a continuation of Washington’s “market-distorting” policies.
On Wednesday, Beijing issued a strong warning, threatening legal action against companies that comply with U.S. restrictions on Chinese chip technology. The Commerce Ministry cited China’s Anti-Foreign Sanctions Law, stating that any organization assisting the U.S. measures would face potential penalties.
Despite ongoing diplomatic efforts, the latest clash raises questions about whether trade negotiations can yield lasting progress. While U.S. and Chinese representatives met last week on the sidelines of an APEC summit in South Korea, no further talks have been announced.
The unfolding dispute highlights the broader struggle between the world’s two largest economies as they vie for leadership in AI and advanced chip manufacturing.
