Epoch AI: Huawei Won’t Be Able to Catch Up with Nvidia by 2030
Epoch AI published an analysis of Huawei’s AI chip roadmap through 2031, concluding that Huawei is unlikely to catch up with Nvidia in AI computing capacity by 2030. U.S. export controls continue to limit Huawei’s access to advanced semiconductor manufacturing and high-bandwidth memory (HBM), constraining both chip performance and production capacity.
- Growing compute gap: Epoch AI estimates that Huawei will produce less than 4 percent as much AI compute as Nvidia in 2026. If Huawei relies entirely on domestically produced HBM, its output could fall to around 1 percent of Nvidia’s by 2028.
- Key bottleneck—HBM: Huawei’s immediate challenge is access to sufficient HBM. As China expands domestic HBM production, the bottleneck is expected to shift from memory supply to chip performance. Even a major increase in HBM production may not close the gap, as Nvidia is simultaneously advancing its chips and adopting more advanced manufacturing processes.
- Huawei’s strategy: Huawei plans to improve its AI chips through higher performance, greater connectivity among chips, and more efficient software utilization. Epoch AI estimates that Huawei’s chips could remain roughly three to four years behind Nvidia through 2030.
- LogicFolding technology and potential limitations: Huawei’s longer-term strategy centers on LogicFolding, a 3D chip-stacking technology designed to increase transistor density without requiring the most advanced lithography equipment. The technology is not expected to reach Huawei’s Ascend line until 2030. Nvidia is also developing stacked-logic technology and may deploy it earlier, potentially limiting Huawei’s ability to gain a lasting technological advantage.
Overall, U.S. export controls appear to be slowing rather than stopping China’s AI chip development. Huawei could narrow the gap through advances in 3D stacking, software, manufacturing, and domestic supply chains. However, based on current technology and production trends, Epoch AI concludes that Huawei is unlikely to match Nvidia’s AI computing capacity by 2030.
Source: Epoch AI, September 4, 2026
https://epoch.ai/publications/huaweis-roadmap-to-2031
Leaked Documents Show China Used Aid to Buy Other Countries’ Support to Suppress Taiwan
Taiwanese media outlet SET News obtained documents allegedly leaked from China’s diplomatic system that appear to show Beijing offering financial assistance to secure diplomatic support against Taiwan. One set of documents concerns Micronesia, while another reportedly involves the African Union. SET News said the documents provide the first apparent Chinese official documentation of Beijing using financial assistance to obtain diplomatic support and restrict Taiwan’s international space.
The documents were allegedly leaked by an insider within China’s diplomatic system and circulated on the dark web through an X account called “hCharizard.”
According to the leaked documents, in late March, the Chinese Embassy in Micronesia sent a diplomatic note asking Micronesia to support Beijing’s position on Taiwan at the 79th World Health Assembly (WHA), including by submitting a letter prepared by China. On April 8, Micronesia’s Foreign Ministry replied that it had submitted the letter, signed by Health and Social Affairs Minister Marcus Samo, supporting the “one-China” principle and opposing Taiwan’s participation in the WHA.
Taiwan’s participation proposal was subsequently rejected at the May 18–23 WHA, marking its 10th consecutive year of exclusion.
The leaked documents also showed a June 10 diplomatic note from the Chinese Embassy offering Micronesia RMB 1 million (US$149,000) in aid, with the funds specifically designated for purchasing one to three Chinese-brand VIP vehicles for the Micronesian Foreign Ministry. Transportation and maintenance costs could also be covered. On June 23, Micronesia’s Foreign Ministry agreed to the revised donation agreement and said it would arrange its signing as soon as possible.
Another batch of documents reportedly shows China proposing RMB 200 million (US$ 28 million) in assistance to the African Union, along with possible request for additional funding.
Source: SET News (Taiwan), September 7, 2026
https://www.setn.com/news/1902651
Chinese Article: China-Japan Air Routes Shrink Sharply Amid Deteriorating Relations; Takaichi Blamed
A Chinese article claimed that Beijing’s restrictions on travel to Japan are having the intended effect. {Editor’s Note: The article attributed the suspension of numerous air routes primarily to a decline in Chinese tourists traveling to Japan. However, there have been reports that the Chinese government instructed travel agencies to stop group tours to Japan and airlines to cancel flights. The following is the briefing of the article.}
China-Japan air travel, traditionally extremely busy during the August summer travel season, has experienced a sharp contraction in 2026. In August, 1,120 flights were reportedly canceled and 18 routes suspended, with the cancellation rate exceeding 30 percent. The decline follows an even sharper contraction in June, when 25 routes were suspended and 1,488 flights canceled, resulting in a cancellation rate of 37.5 percent. Major destinations such as Nagoya, Fukuoka, Sapporo, and Osaka have seen repeated route suspensions. The overall China-Japan air market remains well below its pre-pandemic level.
Japanese Ambassador to China Kenji Kanasugi acknowledged the deterioration in bilateral relations during an August 25 live broadcast on TV Asahi. He said he had initially hoped the APEC meeting in Shenzhen in November could help ease tensions but now had little expectation of improvement. Embassy officials have found it increasingly difficult to meet Chinese government officials and business leaders, while formal meetings have become difficult to arrange. Kanasugi also told Kyodo News in May that substantive dialogue with Chinese officials had effectively been absent for some time.
The deterioration is closely linked to Japanese Prime Minister Sanae Takaichi’s increasingly assertive position on Taiwan. Her remarks linking a Taiwan contingency to Japan’s national survival, along with her emphasis on defense expansion and closer alignment with the United States, have further strained relations. Beijing has responded with measures including tighter controls on rare-earth exports, potentially affecting Japan’s automotive, electronics, and precision-machinery industries.
Source: NetEase, September 5, 2026
https://www.163.com/dy/article/L62TGFRM05567B6B.html
Retired Military Officers Reportedly Unhappy over Removal of Zhang Youxia
The Standing Committee of China’s National People’s Congress has removed Zhang Youxia from his position as vice chairman of the state Central Military Commission (CMC) and Liu Zhenli from his position as a CMC member. Both were also stripped of their National People’s Congress deputy positions. (See Chinascope briefing “China Formally Removes Zhang Youxia and Liu Zhenli from Central Military Commission” (https://chinascope.org/archives/41186.))
The Epoch Times reported, citing sources familiar with the military, that the formal removals have triggered particularly strong reactions among retired military officers. One source said some retired officers were deeply dissatisfied, with some reportedly drinking at home while others refused to answer calls from their former units. Active-duty officers are reportedly more reluctant to express opposition openly because of tighter political controls, while retired officers have greater freedom to voice their views privately.
The report also claims that the military leadership anticipated resistance and took steps to prepare the PLA in advance. Before the NPC Standing Committee announced the removals, political commissars at grassroots units were reportedly instructed to organize study sessions on PLA Daily editorials that outlined the alleged crimes of Zhang and Liu.
Source: Epoch Times, September 3, 2026
https://www.epochtimes.com/gb/26/9/2/n14841227.htm
Phoenix Commentary: China-Russia Visa-Free Travel May Become Permanent
Phoenix published a commentary on Russian President Vladimir Putin’s proposal to make China-Russia visa-free travel permanent.
On August 31, during the Shanghai Cooperation Organization summit in Bishkek, Putin told Xi Jinping that if Beijing considered it feasible and beneficial, the two sides were willing to work toward making visa-free travel permanent. China did not immediately accept or reject the proposal. On September 1, Chinese Foreign Ministry spokesperson Guo Jiakun said mutual visa-free travel “fully reflects” the two countries’ “high level of strategic mutual trust” and would further facilitate people-to-people exchanges and cooperation. The wording suggests that Beijing is receptive to the proposal, although it stopped short of formally agreeing.
The two countries currently have a mutual visa-free arrangement in place through December 31, 2027. The policy has already boosted cross-border travel. In the first half of 2026, about 380,600 Chinese citizens traveled to Russia, up 19.7 percent year-on-year, while 396,000 Russians visited China, up 62.4 percent. Russia has become China’s second-largest source of foreign tourists. The development also reflects China’s broader visa strategy: by 2026, Beijing had extended unilateral visa-free access to 50 countries and established full mutual visa exemption with 29 countries. Unlike many of these arrangements, the China-Russia agreement is based on reciprocity, giving it added political significance.
The proposal also has significant economic and geopolitical implications. China-Russia trade reached $227.9 billion in 2025 and about $134.2 billion in the first half of 2026. As cooperation expands into technology, artificial intelligence, and digital innovation, easier cross-border travel could facilitate deeper business and professional ties. At the same time, with the Ukraine war entering its fifth year and Western sanctions continuing to constrain Russia, Moscow’s economic “pivot to the East” has increased its dependence on China.
Beijing’s response suggests that the proposal is under consideration. A future Xi-Putin meeting could produce a further extension of the current arrangement—or eventually eliminate its expiration date altogether.
Source: Phoenix, September 3, 2026
https://h5.ifeng.com/c/vivo/v002TCf5YDudeUiMHbLlVhXcWjGH0–d2QUXNs-_H3MuUmncw__
Taiwan’s Xiaohongshu Restrictions Highlight Growing Security Concerns
In December 2025, Taiwan announced a one-year restriction on the use of Xiaohongshu, a popular Chinese social media app, citing a surge in scams targeting Taiwanese users and the platform’s alleged lack of cooperation with law enforcement investigations. According to Taiwan authorities, the platform’s failure to provide necessary data has made it difficult for police to investigate fraud cases.
Taiwanese authorities reported that during the eight months following the restriction, Xiaohongshu-related fraud cases fell from 525 to 145, while reported financial losses declined from approximately NT$98.9 million (US$3.12 million) to NT$33.88 million (US$1.07 million).
The issue, however, extends beyond fraud. Xiaohongshu is one of China’s most popular social media platforms, particularly among young people, and has gained a growing following in Taiwan. Users share content about food, travel, shopping, and everyday life, making the platform an unusual channel for people-to-people interaction across the Taiwan Strait. At the same time, Taiwan has become increasingly concerned about the potential risks posed by Chinese social media platforms, including data security, information manipulation, and political influence.
Source: Radio Free Asia, September 4, 2026
https://www.rfa.org/mandarin/zhengzhi/2026/09/04/xiaohongshu-taiwan-ban-data-controversy/
China’s Government Debt Tops 480 Trillion Yuan, Debt Ratio Hits 73.2 Percent at End of 2025
China’s Ministry of Finance reported that national government debt reached RMB 102.5 trillion (approximately US$15.27 trillion) by the end of 2025, pushing the overall debt ratio to 73.2 percent.
The figures were disclosed through “China Finance,” a WeChat account run by the finance ministry, which published a report delivered by Vice Finance Minister Lin Zechang to the Standing Committee of the 14th National People’s Congress on August 31. The report, titled “State Council Report on Government Debt Management for 2025,” detailed the country’s debt position covering both statutory and implicit debt.
Based on China’s preliminary 2025 GDP figure of RMB 140.2 trillion (approximately US$20.89 trillion), the statutory government debt ratio—measuring legally recognized government debt against GDP—stood at 68.5 percent. When local governments’ outstanding implicit debt is included, the ratio rises to 73.2 percent.
Statutory government debt, primarily bonds issued by central and provincial-level governments, totaled RMB 96 trillion (approximately US$14.30 trillion) as of year-end 2025. This included RMB 41.2 trillion (approximately US$6.14 trillion) in central government bonds and RMB 54.8 trillion (approximately US$8.16 trillion) in local government statutory debt.
Local governments’ outstanding implicit debt, after multiple rounds of auditing and debt swaps, stood at RMB 6.5 trillion (approximately US$968.5 billion) by the end of 2025. Beijing has continued efforts in recent years to resolve local debt risks, making the prevention of unauthorized new implicit debt a key priority in debt management.
The report stated that authorities will continue strengthening monitoring and oversight of government debt going forward, imposing strict accountability for violations such as newly created implicit debt, enhancing “penetrating” oversight of special bond projects, and firmly prohibiting misreporting of spending progress.
Source: Central News Agency (Taiwan), September 3, 2026
https://www.cna.com.tw/news/acn/202609030200.aspx
China Tightens Exit Controls on Officials, State Employees, Students
China will implement new exit-management regulations at all border checkpoints starting September 15, imposing stricter controls on residents leaving the country. According to sources cited by Radio Free Asia, the rules introduce a “whoever approves bears responsibility” system: civil servants, state enterprise and public institution staff—including university faculty, doctors, listed company executives—and university students must obtain approval before traveling abroad. If an approved traveler overstays or fails to return, the official who signed off faces accountability.
A source in China’s financial sector described a hierarchical approval chain, with department heads needing approval from bureau chiefs, and so on up the chain. Financial institution and public hospital department heads are reportedly limited to one overseas trip per year.
An insider said the new rules formalize restrictions that had already existed internally, adding fresh limits on financial, research, and student travel—responding to concerns about tech talent and data outflows affecting China’s AI development.
Reports describe university students being blocked from planned trips: one video showed a student stopped at Nanning airport after a scanner flagged her; she said her visa was cancelled and her phone, chat records, and bank statements were searched, and that her entire university of roughly 60,000 students had been restricted from leaving China due to another student’s overstay in Spain.
Separately, Chinese nationals working or living abroad—including in Singapore and the U.S.—reported being contacted by local police demanding passports, employment proof, photos, and real-time location sharing. A Hubei lawyer suggested the crackdown may relate to declining birth rates and concerns over talent and asset flight.
Source: Radio Free Asia, September 3, 2026
https://www.rfa.org/mandarin/shehui/2026/09/03/china-entry-and-exit-management-regulations-capital-fleeing-technology-and-talent-outflow-strict-approval-processing/