Malaysia has enacted export controls on high-performance US artificial intelligence (AI) chips as part of its efforts to prevent diversion of these sensitive technologies to countries like China. The decision comes after pressure from Washington, which banned advanced AI chip sales to China since 2022.
Companies and individuals are now required to notify the Kuala Lumpur trade ministry at least 30 days prior to exporting or shipping such hardware if they suspect it may be misused. Malaysia's strategic location and logistical capabilities make it a major hub for AI chip export and transshipment, raising concerns about indirect use of US technologies for foreign AI development.
A recent report revealed that Chinese engineers had brought hard drives containing sensitive data to Malaysia to build AI models using US-made chips, which were then planned to be sent back to China. The move is also in line with the US's plan to impose export restrictions on AI chip shipments to Malaysia and Thailand, including those from Nvidia.
Tengku Zafrul, Malaysia's Minister of International Trade and Industry, emphasized the need for transparency and lawful trading practices to avoid secondary sanctions that could harm the nation's economy. The country has introduced new regulations requiring permits for exports of high-performance US AI chips to prevent their diversion to countries like China.