TSMC to Suspend Production of Advanced AI Chips for China

Forex - Following Washington's continued efforts to hinder Beijing's artificial intelligence ambitions, Taiwan Semiconductor Manufacturing Company has announced that it will suspend the production of the most advanced AI chips for Chinese chip design companies.

According to three individuals familiar with the matter who spoke to the Financial Times, TSMC, the world's largest contract chip manufacturer, informed its Chinese customers that it will no longer produce AI chips using advanced processing nodes of 7 nanometers or smaller starting next Monday.

Two of these individuals mentioned that the future supply of such semiconductors to Chinese customers by TSMC would be subject to an approval process involving Washington.

TSMC's stricter regulations could derail the ambitions of Chinese tech giants like Alibaba and Baidu, which have made significant investments in designing semiconductors for AI clouds, as well as the growing number of AI chip design startups pivoting towards Taiwanese groups for production.

The U.S. has banned American companies like Nvidia from sending cutting-edge processors to China and has also established a comprehensive export control system to prevent global chip manufacturers using U.S. technology from shipping advanced AI processors to China.