The Reason Behind Allowing NVIDIA Chip Exports to China: 'Dependence on US Technology'

【Financial News Silicon Valley=Hong Changgi Correspondent】 The US Donald Trump administration did not attach much significance to the H20 chip from NVIDIA, which will resume exports to China, stating that it is the least performant among NVIDIA's artificial intelligence (AI) chips. At the same time, it emphasized that it is in the US interest for Chinese companies to continue using the US's cutting-edge AI technology, allowing the US to consistently stay ahead of China in the AI competition. This strategy is explained as a way to supply US AI chips to Chinese companies, making China dependent on US technology.

On the 15th (local time), according to CNBC, Howard Lutnick, Secretary of Commerce, stated, "We need to consider that the H20 is an old chip," adding, "Biden allowed the sale of H20 to China, and we reconsidered that decision. But now NVIDIA has released the most up-to-date chip." Indeed, NVIDIA unveiled the latest AI chip Vera Rubin at the annual developer conference (GTC) held in March this year and began selling the AI chip Blackwell, which was unveiled last year. Secretary Lutnick emphasized, "The H20 chip, which the Trump administration allowed to be sold this time, is the least performant based on performance criteria," and that the US will not export the latest performance AI chips to China.

Regarding the permission to export H20 chips to China, Secretary Lutnick stated, "The Biden administration allowed China's purchase of H20 chips last year, but we blocked it, and after reaching a rare earth agreement with China, we will start selling chips to China again." The agreement mentioned by Secretary Lutnick is an agreement between the US and China during the second trade negotiations held in London, UK, last June, to exchange China's rare earth export controls to the US and some US export controls to China. The US agreed to allow the export of NVIDIA H20 chips to China as a condition for resuming China's rare earth exports to the US.


theveryfirst@fnnews.com