- Microsoft argues against current restrictions on semiconductors
- Tech giant wants Trump to loosen export constraints
- The US and China are in the middle of an AI race
Microsoft has called on President Trump to ease export restrictions on crucial computer chips needed for AI technology.
The previous Biden administration implemented a cap on the export of American AI components to many foreign markets, amid concerns for national security, and while these restrictions are as yet unchanged by the Trump administration, Microsoft has warned the current President that this could give China a ‘strategic advantage’ in spreading its own AI technology, as emerging markets will be forced to turn away from the states for advanced technologies.
The limits, Microsoft argues, undermines two key priorities for US foreign policy; strengthening the US’s leadership in AI technologies, and reducing the country’s trade deficit.
Semiconductor stipulations
It says allies of the US were also affected by the restrictions, like Taiwan, South Korea, India, and Switzerland. The export restrictions “go beyond what’s needed”, and puts these allies in a “Tier Two category and imposes quantitative limits on the ability of American tech companies to build and expand AI datacenters in their countries”.
“The unintended consequence of this approach is to encourage Tier Two countries to look elsewhere for AI infrastructure and services,” Microsoft noted in its statement.
“And it’s obvious where they will be forced to turn. If left unchanged, the Diffusion Rule will become a gift to China’s rapidly expanding AI sector.”
The US and China are engaged in a ‘chip war’, with China declaring US chips unsafe, urging companies to use domestic semiconductors, with both nations racing to develop and build high-powered chips domestically.
Earlier in 2025, Microsoft revealed plans to spend $80 billion on AI data centers, with a large component of this plan focusing on export power.
In 2024, Microsoft also pledged over $35 billion in investments across 14 countries to build AI and data center infrastructure, and has reiterated that the US needs to cooperate with “allies and friends” to maintain its position at the top.
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