DSET visited the Center for Strategic and International Studies (CSIS) on November 3, holding a closed-door roundtable discussion with Dr. Philip A. Luck, Director of the Economics Program at CSIS, along with experts from think tanks, market research institutions, and government agencies.
Participants, whose expertise spans semiconductor economics, global trade, China studies, and Taiwan studies, discussed topics including China’s semiconductor industrial strategy, the geopolitical implications of Chinese outbound investments, and economic security risks associated with offshore AI data centers. The meeting was moderated by Dr. Luck, who previously served as Deputy Chief Economist at the U.S. Department of State under the Biden administration.
At the meeting, Chris Tseng, Non-Resident Fellow at DSET’s Economic Security Program, presented DSET’s newly released policy report analyzing China–Malaysia economic cooperation and the strategic role of Southeast Asian data centers in the AI era. The report finds that Chinese companies have been using Malaysia as a hub to bypass U.S. semiconductor export controls, while simultaneously expanding their global AI infrastructure and market presence.
Read the report: https://dset.tw/en/research/a-shared-future-economic-security-challenges-from-malaysia-china-economic-cooperation-and-data-center-development/
Tseng, who is also a PhD candidate in Sociology at the University of California, Irvine, and the DSET research team developed a geospatial index model mapping data centers in Singapore and Malaysia using open-source and AI-assisted data collection methods. He noted that Johor, Malaysia’s most energy-intensive state for data centers, now sees nearly 60% of its capacity operated by Chinese-backed firms.
The report further identifies a pattern of Chinese investment through the so-called “Bamboo Network” of ethnic Chinese capital in Malaysia, which enables access to restricted U.S.-origin AI chips via four business models: joint ventures, disguised greenfield investments, leasing and hosting arrangements, and hybrid cloud services. Related firms include YTL (Malaysia) and Chinese tech giants GDS, ByteDance, Tencent, and Alibaba.
During the discussion, Tseng urged U.S. policymakers to closely monitor the supply-side risks created by these models. He emphasized that Washington should leverage its control over critical technological nodes to promote due diligence and supply chain transparency, thereby strengthening the security of offshore AI infrastructure and improving the enforcement of export controls. He added that these recommendations ultimately aim to foster U.S.–Southeast Asia partnerships in industrial upgrading and technology governance.
Ming-Yen Ho, Non-Resident Fellow at DSET’s Economic Security Resesarch and a PhD student at UC Berkeley’s Haas School of Business, presented his analysis of China’s semiconductor industrial policies based on global fabrication capacity data. Ho argued that China has pursued a policy path distinct from those of the U.S. and Taiwan — fostering intra-local competition while promoting technological self-sufficiency through a whole-of-supply-chain approach.
Read the report: https://dset.tw/en/research/let-a-hundred-flowers-blossom/
Min-Yen Chiang, Deputy Director of DSET’s Economic Security Research, reflected on the rise of China’s leading AI memory chipmaker ChangXin Memory Technologies (CXMT) and urged U.S. policymakers to pay attention to how China leverages foreign technology and talent to find loopholes in U.S. export controls within the ongoing geopolitical tech competition.
Read the report: https://dset.tw/en/research/the-rise-of-cxmt-inside-the-hydra-like-chinese-memory-sector/
