The history of tension between the United States and China underscores the complex dynamics that have shaped their relationship, extending far beyond recent developments.

Restricting Chinese Access to Cloud Technologies

Amid escalating tensions in the tech industry, the United States has signalled its intent to tighten restrictions on Chinese access to U.S. cloud-based technologies.

Alan Estevez, the United States Undersecretary of Commerce for Industry and Security, recently emphasised the U.S. government's intention to tighten restrictions on Chinese access to U.S. cloud-based technologies.

Estevez addressed journalists at the Mount Fuji Dialogue policy forum on 21 October, highlighting concerns about the potential military implications of unregulated AI and cloud technology access by foreign entities.

“The concern is ... AI in the future will probably command and control military logistics [and] military radar, [and] electronic warfare capabilities will be advanced. So we want to make sure that we’re controlling the use,”

According to Estevez, the U.S. government is considering implementing interventionary measures similar to those imposed on AI chips to control the use and proliferation of cloud-based technologies.

The recent memorandum released by the United States Department of Commerce's Bureau of Industry and Security underscores the strengthening of export controls on AI chips, now subject to global licensing requirements, including exports to U.S.-embargoed countries like China.

Following the recent AI chip export ban, the stock value of leading U.S. market player Nvidia experienced a decline of approximately 5%, a downturn attributed to the market's response to the ban.

Conversely, some industry experts have foreseen a potentially favorable shift for Chinese chip manufacturers in the wake of these developments.

However, the intentions of U.S. lawmakers regarding the implementation of a comparable ban on access to cloud computing technology remain uncertain.

The distinct nature of cloud-based services, which do not necessitate physical export, presents a logistical complexity that sets it apart from other technology sectors.

Exacerbates US-China Relation

The ongoing conflict between the United States and China encompasses a range of complex geopolitical issues, reflecting the broader tensions characterising their relationship.

Heightened by contentious political debates concerning Taiwan, the conflict deepens as China's persistent claims to the island have escalated regional security concerns.

Additionally, China's military advancements, including the modernisation of its naval fleet and the development of advanced weapon systems, have contributed to an atmosphere of strategic competition and military apprehension.

The trade war between US-China, characterised by tariffs and retaliatory measures, has significantly impacted global markets and economic stability, eliciting concerns over the long-term implications for international trade dynamics.

Moreover, the United States military has recently expressed growing concerns about China's access to U.S. cloud technology, highlighting the interplay between national security and technological vulnerabilities.