Trump Signals Policy Shift as US Allows Nvidia AI Chip Sales to China
<p><strong>Trump Announces Major Shift in US Policy on Nvidia AI Chip Sales to China</strong></p><p>In a move that could reshape global technology trade and intensify the competition for artificial intelligence supremacy, former US President Donald Trump announced that the United States will allow Nvidia to sell advanced artificial intelligence chips to China. The decision marks a clear departure from the strict export controls imposed under the previous Biden administration, which had largely blocked China’s access to high-performance AI hardware over national security concerns.</p><p>Trump said the decision followed direct discussions with Chinese President Xi Jinping and would permit Nvidia to export its H200 AI chips to approved Chinese customers under tightly controlled conditions. The policy shift could have far-reaching implications for US chipmakers, China’s AI sector, and the broader geopolitical rivalry between the world’s two largest economies.</p><h3>What Trump Announced</h3><p>In a post on his Truth Social platform, Trump said he had informed President Xi that Washington would now allow Nvidia to ship its H200 chips to China, provided the exports meet strict national security safeguards. He emphasized that the arrangement would apply only to approved customers and would not include Nvidia’s most advanced processors.</p><p>Trump also claimed that a 25 per cent payment would be made to the United States as part of the arrangement, though he did not clarify whether this would take the form of tariffs, fees, or another mechanism. Details of how the policy will be implemented are still being finalised by the US Commerce Department.</p><p>The former president framed the move as a win for American industry and workers. According to Trump, the decision would support US manufacturing, protect American jobs, and generate additional revenue for taxpayers.</p><h3>A Reversal of Biden-Era Restrictions</h3><p>The announcement represents a significant reversal of export controls introduced under President Joe Biden. Those restrictions were designed to prevent China from obtaining advanced AI chips that could be used for military or surveillance purposes.</p><p>Under Biden’s policy, US chipmakers such as Nvidia were forced to either stop selling advanced processors to China altogether or develop downgraded versions with reduced computing power. These modified chips had lower processing speeds and limited capabilities, making them less attractive to Chinese buyers.</p><p>Trump strongly criticised this approach, arguing that it damaged US companies more than it protected national security. He said the restrictions forced American firms to spend billions developing “degraded” products that slowed innovation and weakened the country’s competitive edge.</p><h3>What Makes the H200 Important</h3><p>The Nvidia H200 chip sits below the company’s most cutting-edge processors but remains highly powerful by global standards. It is roughly 18 months behind Nvidia’s latest offerings, such as the Blackwell series and the upcoming Rubin processors, which Trump said will remain exclusive to the US and its allies.</p><p>However, even at that level, the H200 represents a major capability leap for companies training large-scale AI models. GPUs like the H200 are essential for developing large language models — the systems that power generative AI tools similar to ChatGPT.</p><p>Nvidia has previously highlighted how its chips dramatically outperform earlier generations. For example, the H100 — a close relative in Nvidia’s lineup — is around four times faster than the A100 at training large language models and up to 30 times faster at generating responses. These performance advantages can be decisive for companies racing to build next-generation AI systems.</p><h3>Broader Industry Impact</h3><p>Trump said that the same framework allowing Nvidia’s H200 exports would also apply to other major US chipmakers, including AMD and Intel. If implemented broadly, the policy could reopen one of the world’s most lucrative technology markets to American firms that have struggled to compete in China under recent controls.</p><p>Markets reacted positively to earlier signals of eased restrictions, with Nvidia shares previously rallying sharply when talk emerged of a rollback in chip export limits. Analysts say access to the Chinese market could significantly boost revenue for US semiconductor companies at a time when global demand for AI hardware continues to surge.</p><h3>National Security Concerns and Criticism</h3><p>Not everyone in Washington welcomes the move. Critics argue that allowing China access to more powerful AI hardware could undermine US strategic advantage. Democratic Senator Elizabeth Warren accused Trump of making the decision following private discussions with Nvidia CEO Jensen Huang and pointed to Nvidia-linked donations as evidence of undue corporate influence.</p><p>She warned that the policy could “turbocharge China’s military” and weaken America’s long-term technological leadership. Other analysts echoed those concerns, arguing that even chips one or two generations behind the cutting edge can still be highly valuable for military research and surveillance applications.</p><p>Alex Stapp of the Washington-based Institute for Progress described the move as a “massive own goal,” noting that the H200 is significantly more powerful than earlier chips that had already raised security concerns.</p><h3>Nvidia’s Role and Lobbying Efforts</h3><p>Nvidia CEO Jensen Huang has been a vocal advocate for relaxed export controls, frequently arguing that overly restrictive policies hurt US innovation without stopping global competitors from advancing. He has described AI as a transformational technology and urged governments and companies to adopt it early or risk falling behind.</p><p>Reports suggest that Nvidia lobbied heavily against Biden-era restrictions, warning that prolonged exclusion from the Chinese market could allow non-US rivals to fill the gap and permanently damage America’s leadership in the semiconductor industry.</p><h3>The Bigger Geopolitical Picture</h3><p>The policy shift comes amid ongoing trade and technology tensions between Washington and Beijing, especially in artificial intelligence — widely seen as a key driver of future economic and military power. Both countries are investing heavily in AI, and control over the supply of advanced chips is central to that rivalry.</p><p>While Trump’s decision appears designed to balance economic interests with security concerns, it also highlights how difficult that balance has become as AI hardware grows more powerful and more strategically significant.</p><h3>What Comes Next</h3><p>Much will depend on how the policy is implemented in practice. The Commerce Department is expected to spell out the approval process, security conditions, and compliance mechanisms in the near future. Until then, uncertainty remains over how many Chinese firms will qualify and how strictly the controls will be enforced.</p><p>What is clear, however, is that the decision marks a turning point in US technology policy. By partially reopening the door to AI chip exports, the US is signalling a more flexible — and controversial — approach to managing competition with China in the age of artificial intelligence.</p>