China has ignited a veritable firestorm by unveiling new guidelines aimed at expunging US microprocessors from Intel Corp. and Advanced Micro Devices, Inc. in government PCs and servers. This seismic shift sees China opting for domestic technology, a move akin to terraforming its digital landscape.
The new procurement regulations form part of China’s overarching strategy to supplant foreign technology with indigenous solutions. The guidelines also herald the demise of Microsoft’s Windows operating system and foreign-made database software, replaced by the melodic hum of home-grown alternatives, as the Financial Times reported.
On December 26, the Finance Ministry and the Ministry of Industry and Information Technology (MIIT) issued these groundbreaking rules, marking a pivotal moment in China’s quest to cultivate local substitutes for foreign technologies. This echoes similar endeavors in the US during times of escalating Sino-American tensions.
Government agencies and party organs beyond the township level must now prioritize criteria for “safe and reliable” processors and operating systems in their procurements. The China Information Technology Security Evaluation Center has unveiled its inaugural list of approved processors and operating systems, exclusively sourced from Chinese firms.
This transition away from foreign hardware is poised to significantly impact US companies, particularly giants like Intel and AMD, which boast considerable market presence in China. The shifting tide towards domestic providers is slated for completion by 2027.
Microsoft and Intel have chosen to remain silent on the matter, while AMD has not yet responded to calls for comment.
Why It Matters: This move did not materialize out of thin air. As previously reported by Benzinga in May 2022, China urged its central government agencies and state-backed enterprises to substitute all foreign PC hardware and operating systems with domestic alternatives within a two-year timeframe. This aggressive drive is integral to Beijing’s decade-long mission to replace imported technologies with local choices, given mounting privacy apprehensions.
