President Trump said Monday that his administration had granted Nvidia permission to begin selling its second-most-powerful chip to China, a big step up from what the artificial intelligence chip maker had been allowed to offer to Beijing.
The administration had spent months wrestling with whether it was comfortable relaxing its policy on sales of a critical A.I. technology that has the potential to help China militarily and economically.
In a social media post, Mr. Trump said the Commerce Department was finishing the details and would make similar opportunities available to other chip makers like Advanced Micro Devices and Intel. The president said a portion of the chip revenue would go to the U.S. government, a proposition that experts say could violate U.S. law.
The decision is a major win for Jensen Huang. Nvidia’s chief executive, who spent months lobbying the White House to ease its export restrictions.
The move is also a departure for Mr. Trump, whose administration initially promised to restrict sales of A.I. chips to China. The early position had support across much of Washington, and a looser policy that has become clear in recent months has drawn bipartisan complaints from Congress.
Last week, six senators, including Pete Ricketts, a Republican from Nebraska, and Chris Coons, a Democrat from Delaware, introduced a bill that would limit the sale of A.I. chips to China.
The administration’s shift followed a campaign by Mr. Huang and David Sacks, its A.I. and crypto czar, who have pushed back on national security concerns regarding A.I. chips. They have argued that increasing Nvidia’s sales to China would make Chinese companies dependent on its technology and give it more money to develop future generations of chips.
Mr. Huang met with Mr. Trump at the White House last week, and Mr. Trump praised the executive afterward, saying, “He’s done an amazing job.”
John Rizzo, an Nvidia spokesman, said offering H200 chips to approved commercial customers that had been vetted by the Commerce Department would strike “a thoughtful balance that is great for America.”
“We applaud President Trump’s decision to allow America’s chip industry to compete to support high-paying jobs and manufacturing in America,” he added.
The approval of the chip sales was reported earlier by Semafor.
Now the question is: Will China buy Nvidia’s latest offering? The administration wants to encourage Chinese companies to use Nvidia’s H200 chip, which it released last year, while limiting sales of the company’s latest generation of chips, known as Blackwell.
In July, the Trump administration dropped its restrictions on sales of a chip called the H20, which Nvidia developed specifically for China. But Beijing discouraged companies from buying the chip, with administrators warning that it could have “backdoor security risks.”
Nvidia could run into similar challenges when it begins selling the more powerful H200. After the first Trump administration and the Biden administration began limiting U.S. technology sales to China, Beijing increased its spending to become technologically self-reliant. Huawei, the country’s tech giant, has been improving its own A.I. chips.
This summer, Mr. Trump proposed the idea of the government’s taking a cut of A.I. chip sales to China. On Monday, he reiterated that, writing that “$25% will be paid to the United States of America” — a 10-percentage-point increase from what the company previously agreed to pay the U.S. government.
Government lawyers have been researching how to enact such a policy, given that U.S. law prohibits the charging of fees for export licenses. Mr. Huang said in a news conference in Washington in October that government officials were working on a new policy to collect the fees.
Neither U.S. nor Chinese officials have publicly acknowledged that the H200 chips were under discussion. But U.S. rules around the sale of technology to China have been a central issue in the countries’ relationship.
After Mr. Trump imposed double-digit tariffs on Chinese exports in April, Beijing restricted exports of rare-earth minerals essential to a variety of industries. The countries tentatively agreed to walk back those restrictions this spring, but the truce fell apart after the United States announced new restrictions on Chinese technology companies. Chinese officials argued that those measures violated the spirit of their agreement.
At a meeting in South Korea in October, Mr. Trump and Xi Jinping, the leader of China, restored that truce, with the United States promising to keep tariffs low and Beijing to provide steady exports of rare earths and resume its purchases of American soybeans. The agreement was also widely believed to include a de facto U.S. freeze on any new technology restrictions.
Since then, the countries have been working to keep the peace, and in a call with Mr. Xi in late November, Mr. Trump accepted an invitation to visit China in April. On Friday, Scott Bessent, the treasury secretary, and Jamieson Greer, the U.S. trade representative, spoke with China’s vice premier about the steps the sides were taking to maintain the agreement.
But others in Washington have been critical of the administration’s warmer stance toward China. In a letter last week, Senator Elizabeth Warren, Democrat of Massachusetts, expressed concern over the potential sale of the H200 chip.
“I urge you to stop ignoring the input of bipartisan members of Congress and your own experts in order to cut deals that trade away America’s national security,” she wrote.
Tripp Mickle reports on some of the world’s biggest tech companies, including Nvidia, Google and Apple. He also writes about trends across the tech industry like layoffs and artificial intelligence.
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