The United States is taking a striking step in its technological battle with China. The Trump administration gives chip manufacturer Nvidia permission to supply specific AI chips to Chinese customers. The decision raises concerns in politicians, but creates enthusiasm among investors.
Trump approves export of Nvidia’s H200
According to Bloomberg, Nvidia will be allowed to export its powerful H200 AI chips to “approved customers” in China. However, these deliveries are subject to a 25 percent import tariff, which flows directly to the US government. The decision follows intensive lobbying by Nvidia CEO Jensen Huang, who previously argued in Washington for a relaxation of export rules.
The H200 is designed for training and running artificial intelligence. Companies use this chip for self-driving cars, chatbots and image recognition, among other things. According to experts, the H200 is significantly faster than anything currently legally available in China. At the same time, it is a stripped-down variant of Nvidia’s latest Blackwell generation, which remains exclusive to the American market. In this way, the US tries to maintain its technological lead in the global AI race.
The decision is a big boost for Nvidia. The company previously lost billions in turnover due to restrictions on the Chinese market, but now regains access to the largest semiconductor country in the world. AMD and Intel are also allowed to supply to China under similar conditions.
Safety concerns
The partial export ban on advanced AI chips to China went into effect in October 2022 under the Biden administration. The new decision is causing division in American politics. Democratic senators in particular are concerned about national security. They fear that China will gain a strategic advantage with access to these chips, including in the military field. Bloomberg reports that Chinese military institutions are already using American chips to develop AI-driven weapon systems.
Nvidia shares rise
Meanwhile, Nvidia stock is rising in response to the news. In the pre-market it stands at almost $ 187.50, good for an increase of 1 percent compared to yesterday’s closing price.
However, experts are questioning the continued growth of AI companies such as Nvidia, which achieved another milestone in October by becoming the first ever to exceed a valuation of $5 trillion. Michael Burry, known from The Big Short, warns of a new bubble in the AI sector, comparable to the dot-com crisis. According to him, the current growth in AI investments may not be sustainable.
Source: https://newsbit.nl/trump-keurt-nvidia-export-goed-h200-ai-chips-mogen-naar-china/
