A staggering rise in GPU imports to Malaysia is raising red flags among international regulators, amid growing fears the country is being used as a conduit to bypass U.S. export restrictions on high-performance chips to China.
Malaysia imported $2.74 billion worth of GPUs in April 2025 alone — a 3,400% increase compared to the same month in 2023, according to data from Taiwan’s International Trade Administration. The report, first highlighted by tech analyst @kakashiii111, suggests a consistent and exponential surge throughout the year. January and February posted $1.12 billion and $627 million in GPU imports respectively, with March jumping to $1.96 billion.
Cumulatively, Malaysia has imported roughly $6.45 billion in GPUs in just four months, already eclipsing 2024’s total annual imports. The primary source? Taiwan — home to major manufacturers of Nvidia’s Ada Lovelace and GeForce RTX 40-series chips.
This influx coincides with mounting U.S. pressure on Southeast Asian countries to tighten tech export surveillance. Despite diplomatic appeals, the scale and pace of Malaysia’s imports suggest large volumes of Nvidia GPUs may be redirected to China, defying American sanctions targeting AI and high-performance computing hardware.
Further intensifying the situation is the timing. The new AI Diffusion Rule, effective May 15, is designed to curb unauthorized GPU flow to restricted entities. Malaysia’s explosive import activity, right before the rule’s implementation, has only added fuel to speculation that it’s becoming a critical hub in supply chain rerouting operations.
Authorities in nearby Singapore have already busted smuggling rings allegedly funneling Nvidia GPUs to Chinese AI firms like DeepSeek. Taiwan’s customs data also shows computing system exports to Malaysia rising 366% year-over-year in March — a staggering 55,000% leap compared to March 2023.
Adding to the opacity is Nvidia’s recent shift in reporting practices, which now reflect billing locations rather than physical destinations of shipments. This change obscures the true flow of goods and complicates oversight from U.S. agencies striving to enforce chip sanctions.
With scrutiny intensifying and geopolitical stakes rising, Malaysia’s role in the global AI hardware market may soon come under formal investigation.
Read more via Tom’s Hardware.