Cat and Mouse Game: How Chinese Companies Trick Washington

Cat and Mouse Game: How Are Chinese Companies Tricking Washington?

After the US government restricted the export of advanced processors to China, it was revealed that Chinese companies were conducting AI research in digital data centers in Malaysia. The Malaysian government has now launched an investigation into the matter.

Based on a Wall Street Journal investigation, in March of this year, to circumvent US government restrictions, some Chinese engineers transferred hard drives containing digital data to Malaysia and began creating AI models in a digital data center equipped with advanced NVIDIA processors. They planned to return the trained AI models to China.

In a statement issued on June 19, the Malaysian Ministry of Investment, Trade and Industry referred to the news on this matter and stated that it is investigating the matter with relevant authorities to determine whether there has been a violation of laws and regulations.

The ministry indicated that it will align with the US on this issue, stating that the use of NVIDIA processors and AI servers is not restricted under Malaysian law, but that it is willing to cooperate with any government on the issue of trade in sensitive products in export control. In October of last year, the US Department of Commerce announced stricter restrictions on the export of advanced processors to China, including NVIDIA's high-performance H100 and A100 processors. The US government issued another drastic decision in April of this year, restricting NVIDIA's exports of AI processors to China.

Malaysia has become a major digital data center in Southeast Asia and has attracted numerous technology companies in recent years. Chinese companies have attempted to circumvent US restrictions by exploiting various loopholes.