Top-level executives from Intel Corp and Qualcomm Inc are scheduled to make a trip to the nation’s capital next week to engage in discussions regarding China policy, as informed by two anonymous sources familiar with the matter.
The intention behind these visits is to hold productive meetings with U.S. officials, primarily focusing on market conditions, export controls, and other pertinent issues that directly impact the operations of these tech giants.
Unfortunately, the specific individuals they plan to meet remain undisclosed at this time.
When approached for comment, representatives from Intel and Qualcomm opted to remain tight-lipped, refusing to provide any official statements. Similarly, the White House failed to respond to requests for comment, leaving the situation shrouded in mystery.
According to insiders, there is a possibility that other CEOs from the semiconductor industry will also be converging on Washington during the same week.
However, due to the sensitive nature of the discussions, these sources chose to remain anonymous since they lacked authorization to share such details with the media.
Informed sources revealed that U.S. officials are currently contemplating stricter export regulations pertaining to high-performance computing chips, as well as shipments to Huawei Technologies Co Ltd.
This development, first reported by Reuters in June, has implications for Intel, which is preparing to launch a cutting-edge artificial intelligence chip that could potentially be shipped to China. Qualcomm, on the other hand, holds a license to supply chips to Huawei and would also be impacted.
In a bid to safeguard and bolster the domestic chip industry, the Biden administration introduced comprehensive regulations last October to impede China’s semiconductor sector.
This strategic move involved substantial subsidies being injected into the American chip industry, effectively freezing China’s progress in this field.
These potential rule adjustments would have a detrimental impact on Nvidia, a prominent player in the AI chip market. The company’s market value soared to $1 trillion earlier this year, largely due to its strong position in this sector.
The chip industry has been warmly received in Washington in recent years, with lawmakers and the White House actively working towards relocating more production to the United States and its allies, while simultaneously reducing dependence on China.
The CEOs of Intel and Qualcomm, namely Pat Gelsinger and Cristiano Amon, have been frequent attendees of meetings with government officials, illustrating the close collaboration between these influential technology companies and the U.S. government.
The forthcoming meetings, as mentioned by one of the sources, may potentially involve joint sessions between industry executives and U.S. officials.
These discussions become increasingly significant as Nvidia Corp and other chip manufacturers worry about enduring long-term sales losses due to escalating tensions between Washington and Beijing, especially in an industry that generates substantial revenue from business in China.
The primary objective of the executives in these meetings, according to the aforementioned source, is to ensure that government officials fully comprehend the potential consequences of implementing stricter regulations on chip sales to China.
It is essential for them to convey the message that any further limitations could have a far-reaching impact.
It is worth noting that a significant portion of revenue for many U.S. chip companies is derived from Chinese markets, accounting for over one-fifth of their total earnings.
Industry leaders have emphasized that curtailing these sales would not only adversely affect profits but also hinder their ability to reinvest in crucial research and development endeavors.
Reported by Andrea Shalal in Washington, Stephen Nellis in San Francisco, and Karen Freifeld in New York, this development raises concerns and underlines the significance of the upcoming meetings.
As the situation unfolds, the world waits to see how these discussions will shape the future of the semiconductor industry, and the delicate balance between economic stability and geopolitical tensions hangs in the balance.
Edited by Chris Sanders and Edmund Klamann, this news piece offers a glimpse into the high-stakes negotiations occurring within the tech sector, shedding light on the interplay between global politics and business interests.