David Bridges
Key Highlights
- Announcement: Donald Trump has stated he will permit Nvidia to sell the H200 artificial intelligence chip to China.
- Conditions: The sale will be under terms that ensure U.S. national security, with Nvidia paying a 25% revenue share to the government.
- Impact: This move is seen as a positive outcome for Nvidia, as the H20 chip had previously been dismissed by the Chinese government.
- Future Meetings: Trump is set to meet with China’s President Xi Jinping in April.
Donald Trump says he’s going to allow Nvidia to sell the H200 artificial intelligence chip to China, according to a new post from the president on Truth Social. The move will still bar Nvidia from selling its more advanced Blackwell chips to China, but it’s still considered a win for the tech company since the lower quality H20 chip had been sidelined by the Chinese government for supposedly not being powerful enough.
Trump wrote Monday that he had informed China’s president Xi Jingping that he will allow the sale of H200 chips “under conditions that allow for continued strong National Security.” Trump did not explain what those conditions might be, but said Nvidia will pay the U.S. government 25% from sales of the chips to China.
Over the summer, Nvidia and AMD agreed to give the U.S. government 15% of revenue from chip sales to China in a bizarre quid pro quo arrangement, according to the Financial Times. Experts noted at the time that no private company had ever entered into such a deal and the legality was questioned. Trump’s second term has been filled with extreme actions that often confound experts in a given field. Can presidents just unilaterally declare birthright citizenship null and void? Virtually every constitutional expert says no, but the U.S. Supreme Court has taken up the case, and if members of the conservative-dominated court so choose, they could very well invalidate the 14th Amendment.
Trump touted the sale of H200 chips as a win for U.S. workers Monday, though it still needs to be formally finalized by the U.S. Commerce Department, which handles export controls. But federal agencies under Trump aren’t exactly in the business of second guessing him these days.
“This policy will support American Jobs, strengthen U.S. Manufacturing, and benefit American Taxpayers,” wrote Trump. The president went on to claim that President Joe Biden’s administration had “forced” U.S companies to spend billions of dollars building “‘degraded’ products that nobody wanted,” which he called a terrible idea that slowed innovation and hurt American workers. Obviously those “degraded” products are created that way to give the U.S. a technological edge, just as his government has supposedly tried to do.
“That Era is OVER! We will protect National Security, create American Jobs, and keep America’s lead in AI,” wrote Trump. “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.”
As Bloomberg notes, the Chinese government urged potential customers to reject the less powerful H20 chips. It wasn’t an outright ban, and there’s still reportedly demand for the H20 in the country, but it still probably applied some pressure on the U.S. to reexamine the issue if the world’s second largest market for chips was unlikely to bite.
Nvidia CEO Jensen Huang has been cozying up to Trump during the president’s second term, just like virtually every other tech CEO in the country. And it looks like Nvidia’s lobbying has really paid off. David Sacks, the so-called AI and crypto czar, also pushed back on security concerns about selling chips to China, according to the New York Times. Sacks and Huang have reportedly argued that selling the more advanced chips to China will make the country more dependent on U.S. tech.
It remains to be seen what will happen to the SAFE CHIPS Act, a bipartisan bill unveiled last week to restrict any efforts by Trump to loosen the export restrictions, according to Reuters. The bill is sponsored by Republican Senator Pete Ricketts and Democrat Chris Coons. Opposing Chinese tech influence seems to be the only thing that most elected Republicans and Democrats can agree on, though it often doesn’t matter what Congress says when Trump wants something. For example, the TikTok ban was bipartisan legislation that even Trump supported until he pulled a 180 in 2024. Trump has unilaterally extended enforcement of the ban several times while a deal is worked out. The next deadline is Dec. 16.
“My Administration will always put America FIRST,” Trump wrote Monday. “The Department of Commerce is finalizing the details, and the same approach will apply to AMD, Intel, and other GREAT American Companies. MAKE AMERICA GREAT AGAIN!”
President Trump is scheduled to visit Beijing and meet with Xi in April.
Brandon Fletcher
