(Reuters) – Top Chinese firms, including Alibaba and ByteDance, are reportedly training their artificial intelligence models outside of China in an effort to gain access to Nvidia‘s chips while circumventing U.S. measures aimed at hindering their advancements in sophisticated technology. This development was highlighted in a report by the Financial Times on Thursday.
The companies are utilizing data centers in Southeast Asia to develop their latest large language models, according to two sources familiar with the operations. These offshore training initiatives have reportedly increased since the U.S. implemented restrictions on the sale of the H20 chip in April, further underscoring the growing challenges faced by Chinese technology firms in acquiring essential hardware.
In light of these restrictions, Chinese companies have turned to lease agreements with non-Chinese entities that own and operate overseas data centers. Notably, the firm DeepSeek stands out as an exception; it has managed to stockpile a significant amount of Nvidia chips prior to the U.S. export bans and is now training its models domestically.
DeepSeek is also collaborating with domestic chip manufacturers, notably those led by Huawei, to optimize and create the next generation of Chinese AI chips, according to the same report. This partnership signals a strategic pivot for Chinese tech companies as they navigate the tightening grip of U.S. export controls.
The response from Alibaba, ByteDance, DeepSeek, and Huawei to requests for comment remained unaddressed as of the report’s publication. The ongoing developments illustrate the increasingly complicated landscape for Chinese tech firms attempting to leverage advanced AI capabilities amid geopolitical tensions.
As these companies adapt their strategies, the implications for the broader technology sector are significant. With the U.S. tightening its grip on the semiconductor supply chain, firms will likely continue to explore alternative routes for accessing critical technology, including partnerships with foreign entities and investments in domestic capabilities. The race for AI supremacy continues, and how these changes will shape the future of technology in China and beyond remains a critical question for industry observers.
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