WASHINGTON, DC – The U.S. government is preparing to expand its AI export controls, planning to restrict the shipment of advanced AI chips to Malaysia and Thailand, according to a Bloomberg report and additional sources in Washington and Asia. The move, led by the Trump administration, is part of a strategic effort to prevent indirect technology transfers to China through third countries.

The U.S. Department of Commerce is finalizing a draft regulation that would overturn existing global export allowances for AI technologies, instead reinforcing a tighter framework that continues to block access for China and over 40 other nations. While the new restrictions are not yet finalized, officials expect them to come into force by late Q3 2025.

A Targeted Approach to Counter Evasion Risks

U.S. intelligence agencies have reportedly flagged Malaysia and Thailand as potential transit hubs for restricted technology, citing concerns that AI chips produced by firms such as Nvidia may be re-exported or repurposed in violation of U.S. sanctions. The new export policy seeks to preemptively close those loopholes, mirroring recent moves to tighten semiconductor flows globally.

For now, U.S. companies and firms in select allied nations will be permitted to continue AI chip exports without a license—a temporary window expected to last until at least early 2026. After that, analysts anticipate a broader licensing regime or expanded country lists under the U.S. Export Administration Regulations (EAR).

Industry and International Response

As of press time, Nvidia has not commented on the proposed restrictions. Likewise, the governments of Malaysia and Thailand have remained silent, though local officials have privately expressed concern over the economic and diplomatic ramifications.

Southeast Asia has emerged as a key node in the global semiconductor supply chain, with Malaysia and Thailand hosting both manufacturing and testing facilities for major U.S. tech firms. Analysts warn that the new U.S. export controls could disrupt supply chain stability, especially if additional countries are added to the restricted list.

Geopolitical Context and Policy Realignment

The decision aligns with a broader recalibration of U.S. AI and tech policy, as Washington seeks to assert leadership in global AI standards and prevent strategic leakage to geopolitical rivals. Sources within the administration suggest the new export rules are also part of efforts to tighten alliances by encouraging deeper technology sharing frameworks among trusted partners, while applying pressure on non-aligned or high-risk countries.

However, international trade experts caution that such unilateral moves could trigger retaliation or accelerate “de-Americanization” strategies by affected nations, potentially pushing them toward alternative suppliers in Europe or Asia.

Reshaping the future of AI supply chains

The proposed changes reflect an increasingly securitized view of AI hardware, particularly as high-performance chips become central to defense, surveillance, and critical infrastructure systems worldwide. While the immediate impact remains limited to two Southeast Asian nations, the precedent set by these restrictions could reshape the future of AI supply chains—with Washington’s export policy becoming a new front in global tech geopolitics. (zai)