The decision appears to settle a U.S. debate about whether Nvidia and rivals would maintain their global lead in AI chips by selling to China or withholding chips, though Beijing has told companies not to use U.S. technology, leaving it unclear whether Trump’s decision would lead to new sales.
Sign up here.
“We will protect National Security, create American Jobs, and keep America’s lead in AI,” Trump wrote on Truth Social. “NVIDIA’s U.S. Customers are already moving forward with their incredible, highly advanced Blackwell chips, and soon, Rubin, neither of which are part of this deal.”
Trump did not say how many H200 chips would be authorized for shipment or what conditions might apply, only that exports would occur “under conditions that allow for continued strong National Security.”
Administration officials consider the move a compromise between sending Nvidia’s latest Blackwell chips to China, which Trump has declined to allow, and sending China no U.S. chips at all, which officials believe would bolster Huawei’s efforts to sell AI chips in China, a person familiar with the matter said.
“Offering H200 to approved commercial customers, vetted by the Department of Commerce, strikes a thoughtful balance that is great for America,” Nvidia said in a statement.
Intel declined to comment. The U.S. Commerce Department, which oversees export controls, and AMD did not respond to requests for comment.
A White House official said that the 25% fee would be collected as an import tax from Taiwan, where the chips are made, to the United States, where the chips will undergo a security review by U.S. officials before being exported to China.
FEARS OF CHIPS STRENGTHENING CHINA’S MILITARY
China hawks in Washington are concerned that selling more advanced AI chips to China could help Beijing supercharge its military, fears that had first prompted limits on such exports by the Biden administration.
“It’s a terrible mistake to trade off national security for advantages in trade,” said Eric Hirschhorn, who was a senior Commerce Department official during the Obama administration. “It cuts against the consistent policies of Democratic and Republican administrations alike not to assist China’s military modernization.”
According to a report released on Sunday by the non-partisan think tank the Institute for Progress (IFP), the H200 would be almost six times as powerful as the H20, the most advanced AI semiconductor that can legally be exported to China, after the Trump administration reversed its short-lived ban on such sales this year.
Several Democratic U.S. senators in a statement described Trump’s decision as a “colossal economic and national security failure” that would be a boon to China’s industry and military.
CHINA EYES POTENTIAL SECURITY RISKS
Chris McGuire, an expert on technology and national security who served at the U.S. State Department until this summer, said Chinese firms would likely still buy H200s.
“China would almost certainly accept it,” said McGuire, now a fellow with the Council on Foreign Relations. “It would be self-defeating not to, given the H200 is better than every chip the Chinese can make.”
But Craig Singleton, a senior fellow at Washington think tank Foundation for Defense of Democracies, said it remained unclear how Beijing would react to U.S. export approvals.
“Chinese firms want H200s, but the Chinese state is driven by paranoia and pride — paranoia about backdoors and dependence on U.S. chips, and pride in pushing domestic alternatives,” Singleton said. “Washington may approve the chips, but Beijing still has to let them in.”
Reporting by Jasper Ward, Treveor Hunnicutt and Michael Martina in Washington, Karen Friefeld in New York and Stephen Nellis in San Francisco; Writing by Doina Chiacu; Editing by Leslie Adler, Rod Nickel, Peter Henderson and Jamie Freed
Our Standards: The Thomson Reuters Trust Principles.
