"The U.S. government changed its Nvidia plans in August and let it export its chips to China, after heavy lobbying by CEO Jensen Huang. Huang also went to China in what might be called shuttle diplomacy. President Trump said he wanted a 15% export license for Nvidia's products. Although expensive, it gave Nvidia access to the world's second-largest consumer of AI chips."
"On July 15, Howard Lutnick, the U.S. Secretary of Commerce, told CNBC that the H20 did not threaten U.S. AI success because it was far from Nvidia's best products: "We don't sell them our best stuff, not our second-best stuff, not even our third-best." Chinese officials described the comments as an insult. Lutnick's comments also allowed Chinese officials to push for the use of the nation's homegrown AI chips. Among the reasons given were that the H20 was a "security risk.""
U.S. export controls blocked Nvidia chip exports to China in April, including the less-powerful H20 intended to limit China’s AI advancement. The U.S. reversed course in August after heavy lobbying by CEO Jensen Huang and his visits to China, with President Trump seeking a 15% export license, enabling Nvidia access to a major AI-chip market and helping China improve products like DeepSeek. Industry leaders warned that improving Chinese products threatened U.S. AI dominance. A July 15 comment by Commerce Secretary Howard Lutnick calling H20 far from Nvidia’s best prompted Chinese officials to promote homegrown chips, label H20 a security risk, and led Nvidia to stop H20 production. Nvidia is preparing another chip for China, contingent on U.S. government approval.
Read at 24/7 Wall St.
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