Malaysia Eyes Huawei Chips for Sovereign AI Program Despite U.S. Warnings

Malaysia is weighing the use of Huawei Technologies’ AI chips in a 2 billion ringgit ($494 million) state-backed project, Bloomberg reported, citing people familiar with the matter. If materialized, it would mark a breakthrough for China’s AI chip industry and complicate the Trump administration’s efforts to steer countries toward U.S. technology.

The Malaysian government is considering Huawei’s Ascend 910C chip rather than the newer 950 series, which remains in limited production, according to Bloomberg. Huawei’s chips still lag behind Nvidia’s in performance, but the Chinese company is expanding into markets such as Southeast Asia and the Middle East as it works to overcome years of U.S. restrictions.

Malaysia’s choice could strain relations with Washington, given the country’s heavy reliance on U.S. technology investment. Nvidia, Microsoft and Oracle have helped drive Malaysia’s rapid data-center growth, yet government-linked Telekom Malaysia selected Huawei as a potential supplier for the sovereign AI project, according to Bloomberg. Telekom Malaysia already uses Huawei equipment in its cloud infrastructure, although its existing AI computing service runs on Nvidia chips.

Washington has warned that using Huawei’s Ascend 910 series chips could violate U.S. export controls. The warning partly stems from the discovery of chips made by Taiwan Semiconductor Manufacturing Company inside Huawei’s earlier Ascend 910B processors, despite restrictions barring the Taiwanese foundry from supplying Huawei without a license.