Trump’s Approval of Nvidia’s Chip Sales to China Sparks US Concerns
The decision by US President Donald Trump to permit Nvidia to sell more advanced AI chips to China appears to yield limited advantages. Reports says that this action has sparked national security concerns within the US and has raised doubts about China’s actual interest in the technology that is being approved for sale. Nvidia has been granted approval to sell its H200 chips to China, as reported, with the US government poised to receive a 25 percent share of all sales. The H200 represents a notable advancement compared to the H20, the lesser version that Nvidia was compelled to create due to previous export limitations, which China largely dismissed. Trump characterized the approval as a departure from the policies of the prior administration, stating on Truth Social, “The Biden Administration forced our Great Companies to spend BILLIONS OF DOLLARS building ‘degraded’ products that nobody wanted, a terrible idea that slowed Innovation, and hurt the American Worker.”
Reports says that although the H200 is the most advanced chip Nvidia is permitted to sell in China, it remains a complete generation behind the company’s latest Blackwell chips. Beijing, concentrating on the growth of its semiconductor industry, is also anticipated to take a measured approach in acquiring the newly approved hardware. According to the reports, Chinese regulators might impose restrictions on access to the H200, necessitating that buyers provide justification for why domestic chips are insufficient for their requirements. Nvidia CEO Jensen Huang has conveyed doubt regarding China’s interest in the H200, stating he was uncertain about its potential acceptance. Investor reaction seemed muted as well, with Nvidia’s stock finishing down 0.3 percent on Tuesday.
In another report, Axios underscored concerns from critics who worry that the sale of H200 chips may enable China to enhance its semiconductor capabilities by gaining access to US technology. However, the practical impact may be diminished as China has already secured substantial quantities of Nvidia chips prior to the export restrictions. The reports says that over USD one billion in banned chips had made their way into China via black market channels. On Tuesday, US prosecutors revealed the disruption of a smuggling network linked to China, which was trafficking over USD 160 million in restricted Nvidia chips, including H200 units. The US Attorney’s Office, in its indictment, cautioned that the chips being sent to China posed a risk of “compromising America’s technological edge” in AI and jeopardizing national security, according to the reports.
Axios reports that Nvidia has sought permission to sell H200 chips in China for some time, yet this endeavor seems unlikely to yield substantial strategic or commercial advantages for the company, nor for either party in the larger geopolitical rivalry.
