US President Donald Trump has recently introduced new trade restrictions on China, with NVIDIA no longer being allowed to sell its NVIDIA H20 graphics cards built specifically for the Chinese market to companies in the country.
The latest trade restrictions introduced by the US President are not surprising, but to enable companies around the world, especially China, to obtain the latest and most powerful AI components, Malaysia seems to have become the regional distribution hub of choice for a number of AI hardware technology development companies.
According to the Taiwan International Trade Administration, it has been reported that Taiwan’s total exports of AI components and hardware to Malaysia amounted to $1.873 trillion in March 2025 alone, a 366 percent year-on-year increase compared to the same time last year, which amounted to only $401.92 million.
There is no denying that Malaysia is a regional and international trading hub, but the recent incident where Malaysia was used as a location to smuggle NVIDIA AI graphics cards to banned Chinese companies also highlights the need for the government to ensure that all trade that takes place does not violate any agreed international laws.
With the recent ban imposed on companies such as NVIDIA preventing them from selling their NVIDIA H20 AI graphics cards to Chinese companies, the knowledge that Malaysia is a hub for trading these AI components is likely to backfire if not properly regulated.