US Bans Chinese Data Center Gear As Beijing Grounds Its AI Talent

Lucie Daudigny, a press officer at Legrand, told Asia Times that it was too early for the company to comment on Trump's executive order, as many details of the measures had not yet been finalized.

“From a manufacturing point of view, the components we use are made by global companies such as ABB and Schneider,” James Peacock, chairman of TES Group, said in an interview in Northern Ireland.“I don't perceive anything we put into our products that would stop us from delivering them to the US market.”

“The North American market is a great opportunity. The challenge for TES right now is that we're so busy scaling in Europe. Have we got enough bandwidth to scale in North America at the same time?” he said.

He added that Legrand buys strategic businesses that fill gaps in its portfolio and lets them operate as standalone businesses in their own silos, though he would not rule out future collaboration.

On September 25, four US senators introduced a bill to bar federal agencies from buying for national security systems any Chinese optical transceivers, which move data across AI networks. Optical transceivers are modules that convert electrical signals into light pulses to move data between servers, and large AI data centers need millions of them.

The Coalition for a Prosperous America (CPA), a Washington-based lobbying group, pointed out that Chinese firms control roughly 70% of the global optical module market. It said Zhongji Innolight, the world's largest manufacturer of high-speed optical transceiver modules, still has its hardware inside America's data centers and national security systems, although it was added to the Department of Defense's list of Chinese military companies in June.

Since 2022, Washington has used chip export controls to slow China's AI progress. China has fought back with Southeast Asian data centers, smuggled Nvidia chips, homegrown Huawei processors and AI models partly distilled from US ones.

This year, Washington began allowing exports of more advanced chips such as Nvidia's H200. Beijing approved some H200 purchases this summer and is reportedly now weighing imports of Nvidia's RTX PRO 5500.

The US-China AI race is now being fought at the data center level.

On Tuesday, Trump hosted a White House lunch with 31 technology executives, including Elon Musk and Nvidia's Jensen Huang. Recalling a meeting with Xi that Musk also attended, Trump said the Chinese leader was keen to attract AI data centers to China.

“He would love to have every single one because they're smart. They want every data center. They want it because that's great for China,” Trump told reporters after meeting dozens of technology executives on Tuesday.

He said he wanted global firms to build AI data centers in the US rather than in Nordic countries or China, as they would bring investment, jobs and tax revenue to America.

Attendees at Tuesday's lunch signed a voluntary accord on“superintelligence” (the term that Trump prefers instead of artificial intelligence) that includes internal and external reviews of the technology. Trump said the self-policing agreement was morally binding but stopped short of backing new government guardrails. He ruled out working with Xi on governing AI.

“A lot of people say, let's do it together with China, but then they're going to be able to immediately gain access to things that we know that they don't know,” he said.“We're leading now over China and everyone else, and I want to keep it that way.”

Chinese commentators criticized Trump for sending mixed signals on global AI governance.

“Before the Xi-Trump summit, US Treasury Secretary Scott Bessent led the AI dialogue between the two sides, and media reports said they had reached some consensus on joint AI regulation,” Peter Qiu, the founder and president of the Hong Kong Center for Globalization (CGHK), says in an article.“Trump's sudden opposition to working with China on AI regulation suggests that his team is willing to cooperate with Beijing, while he himself wants a strategic rivalry.”