Fight escalates over TikTok and WeChat, China unveils “Unreliable Entity List” and JAIC hosts AI Partnership for Defense

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Worth Knowing

Fight Escalates Over TikTok and WeChat: Chinese social networking apps TikTok and WeChat continue to operate in the United States despite Trump Administration efforts. Some recent developments:
The WeChat and TikTok bans have faced criticism, with some experts arguing they would hurt U.S. businesses and violate freedom of speech.
China Unveils “Unreliable Entity List” of Overseas Organizations: One day after the U.S. TikTok and WeChat bans were announced, China’s Ministry of Commerce released details about its “Unreliable Entity List,” an anticipated list of foreign organizations with trade restrictions intended to parallel the U.S. Entity List. Beijing’s version would prohibit or limit imports, exports and investments from companies taking “discriminatory” measures against a Chinese organization or person or deemed a danger to China’s national security. So far, no organizations are listed. State-backed media suggested that U.S. companies Qualcomm, Cisco, Apple, Boeing and FedEx might be added; however, The Wall Street Journal reported some Chinese leaders believe companies should not be added before the U.S. presidential election.
Microsoft To Exclusively License OpenAI’s GPT-3: Microsoft will exclusively license OpenAI’s GPT-3, according to a September 22 company announcement. Unveiled by OpenAI in June, the 175 billion parameter natural language processing model quickly gained attention for its ability to answer questions, write computer code and generate essays. The details of how the “exclusive license” will work have not been publicized; early reports suggest that while others can use GPT-3 through the API, Microsoft alone will have access to the underlying code. The two companies’ relationship is ongoing: Last summer, Microsoft announced it would invest $1 billion in OpenAI, and in May it revealed a collaboratively designed supercomputer. OpenAI faces some criticism for making the new GPT-3 deal exclusive.
China May Block Nvidia’s Purchase of Arm: Per an op-ed in Chinese state-run media, the Chinese government may not approve U.S. GPU designer Nvidia’s $40 billion acquisition of U.K. chip company Arm. A Global Times editorial  described the acquisition as “disturbing” both for Chinese and European companies, arguing that the purchase would disadvantage Chinese ones especially amid U.S.-China tensions. The editorial quotes Arm co-founder Hermann Hauser, who said the deal would compromise Arm’s position as the “Switzerland of the semiconductor industry.” Chinese regulators have not publicly commented on the deal; the last time a semiconductor deal of this size was attempted, it was not approved.
Government Updates

JAIC Hosts First AI Dialogue for Defense: The Pentagon’s Joint AI Center hosted its first AI Partnership for Defense meeting on September 15–16 in collaboration with the governments of 12 other countries across Europe, Asia and the Middle East. The Partnership for Defense provides a recurring forum for military and defense organizations to discuss approaches to military applications of AI. The first meeting included the U.K., France, Israel, South Korea and Japan, among others; JAIC leadership expects more countries to join in the coming year. Defense Secretary Mark Esper announced the partnership at the DOD AI Symposium on September 9.

Commerce Department Restricts Sales to SMIC: The Department of Commerce is requiring U.S. chip companies to obtain a license before exporting certain technologies to Chinese chipmaker Semiconductor Manufacturing International Corp., The Wall Street Journal reports. SMIC is China’s largest semiconductor manufacturing company and is backed by state-owned entities; the Commerce Department is concerned SMIC will use U.S. semiconductor manufacturing equipment to make advanced chips for use by the Chinese military. SMIC denied any relationship with China’s military and said it provides services solely for civilian and commercial purposes.

Resolution Outlining National AI Strategy Introduced: On September 16, Reps. Hurd and Kelly introduced a concurrent resolution containing principles for a national AI strategy. The bipartisan measure outlines actions in the areas of workforce preparedness, national security, R&D and ethics. Hurd and Kelly held a series of stakeholder meetings and wrote four reports with the Bipartisan Policy Center, including one on national security that CSET co-authored. The resolution encourages collaboration with allies, increased R&D funding and expanded support for technology education programs. Reps. Chabot, Veasey, Moulton, Baird, Cloud and Connolly also co-sponsored it.

In Translation
CSET’s translations of significant foreign language documents on AI

Strategic New Industry Investment Guiding Opinions: New Chinese Ambitions for “Strategic Emerging Industries.” This translation is the result of collaboration between CSET and the DigiChina Project, based at the Stanford University Cyber Policy Center and a joint effort with New America. Issued jointly by several PRC ministries in September 2020, this policy document lays out China’s priorities for the development of strategic emerging industries ahead of this fall’s Party plenum on the upcoming 14th Five-Year Plan.

Xi Jinping Speeches at Expert Symposia: Xi delivered these speeches to meetings of academics in August and September of 2020 that he convened to solicit input for China’s upcoming 14th Five-Year Plan.
  • Speech at the Symposium of Experts in Economic and Social Fields. In his remarks, Xi emphasizes the importance of reducing the Chinese economy’s dependence on foreign markets, although he insists that “opening up” to the world continues to be China’s policy and calls for cooperation with U.S. state and local governments and companies.
  • Speech at the Symposium of Scientists. Xi stresses the need for China to improve its economic and scientific self-sufficiency, urges increased investment in basic research and advocates both for better domestic training of scientists and continued efforts to recruit foreign scientists.
What We’re Reading

Paper: The Future of Military Applications of Artificial Intelligence: A Role for Confidence-Building Measures?, Michael C. Horowitz, Lauren Kahn and Casey Mahoney (August 2020)

Report: Government Incentives and U.S. Competitiveness in Semiconductor Manufacturing, Boston Consulting Group and Semiconductor Industry Association (September 2020)

Report: Europe and AI: Leading, Lagging Behind, or Carving Its Own Way?, Carnegie Endowment For International Peace (July 2020)

Paper: The Hardware Lottery, Sara Hooker, Google Brain (September 2020)

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