The tech confrontation between the United States and China continues to intensify. China has rolled out new guidelines that will progressively phase out the use of American technology in public computers, a move set to impact major firms like Microsoft, Intel, and AMD.
On December 26, Beijing unveiled new rules that are starting to take effect, as reported by The Financial Times. The regulation requires Chinese municipal public agencies to replace microchips or computer systems developed in the United States with ones that are considered safe and reliable, produced exclusively by Chinese companies. The transition must be completed by 2027.
The measure directly targets processors used in laptops designed and manufactured by California-based Intel and Advanced Micro Devices (AMD). Both companies lead the market for this critical semiconductor device, but their dominance is expected to shrink under Beijing’s decision. Last year, China accounted for about 27 percent of Intel’s 54 billion dollars in sales and roughly 15 percent of AMD’s 23 billion dollars in sales.
The Chinese guidelines will also push to eliminate the public use of Windows, Microsoft’s operating system, as well as foreign-made manufacturing software, according to internal FT sources.
Tech War
With this protectionist move, China aims to boost its domestic tech industry and reduce dependence on foreign suppliers. Central to its strategy are semiconductors, the brains of computers, but also crucial for mobile devices and artificial intelligence systems. Ensuring self-sufficiency would allow China to continue growing and challenge U.S. technological leadership.
The rise of the United States as a major rival weighs heavily on Washington. Aware of its sway in the global supply chain, the U.S. administration has applied a broad set of export controls to curb China’s ascent. President Biden has restricted chip sales to China by firms like Nvidia and AMD, and has secured Japan and the Netherlands to adopt similar embargoes with key partners.
Despite these export limits, China’s top manufacturer, SMIC, is reportedly advancing in production capabilities, with processors built at increasingly small scales. Huawei, a Chinese telecommunications giant also under U.S. sanctions, remains a primary recipient of these components.