Trump Greenlights Nvidia H200 Chip Exports to China, Easing Restrictions

Post by : Mina Rahman

Former President Donald Trump has paved the way for Nvidia to export its advanced H200 chip to China, a significant relaxation of U.S. export controls aimed at Chinese technology.

In his announcement, Trump revealed that he had notified Chinese President Xi Jinping about this decision, which includes a stipulation for 25 percent of sales revenue to be directed to the U.S. government. The exports will be permitted only to "approved customers" under conditions designed to safeguard national security, with similar measures anticipated for other leading chipmakers like AMD and Intel.

Trump stated, "This policy will bolster American jobs, improve U.S. manufacturing, and benefit American taxpayers."

Nvidia, based in Santa Clara, California, characterized the decision as a "thoughtful balance" that will promote high-paying jobs and domestic manufacturing. Following the announcement, Nvidia's shares surged over 2 percent in after-hours trading.

This decision marks a significant shift from the previous administration's restrictions, which limited Nvidia and other chip manufacturers to exporting downgraded versions of their offerings to China. Trump criticized that strategy, contending it compelled U.S. tech firms to invest billions in products that lacked demand.

The H200 chip, unveiled in 2023, stands as Nvidia's most powerful chip outside the latest Blackwell series and boasts nearly six times the power of the older H20 model. Previously, Nvidia paid 15 percent of H20 sales revenue to the U.S. government to comply with restrictions related to China.

Experts suggest Trump's choice mirrors market realities and the lobbying efforts of Nvidia CEO Jensen Huang. The focus is transitioning from obstructing China’s tech progress to competing for market share and obtaining commercial benefits.

Tilly Zhang, a tech expert, noted, "This action indicates a shift from containment of China to enhancing American tech capability while securing revenue."

However, the move has faced strong opposition from Democratic lawmakers. Senator Elizabeth Warren accused Trump of "compromising U.S. security" by enabling advanced AI chips to reach China, even after earlier warnings about illicit shipments.

Tech policy experts have cautioned that less stringent export controls could enable Chinese AI companies to catch up to U.S. standards, enhance global cloud computing infrastructure, and possibly undermine U.S. dominance in artificial intelligence.