In a significant reversal in the ongoing trade war between the two largest economies in the world, US President Donald Trump said on Monday that he is lifting export restrictions on Nvidia’s H200 chips to China.
The second most potent AI processor in Nvidia’s lineup, the H200, is essential for finishing tasks carried out by AI.
Trump noted that the agreement does not include Nvidia’s highly sought-after Blackwell chips or next-generation Rubin chips.
The US president took to Truth Social and wrote, “I have informed President Xi, of China, that the United States will allow NVIDIA to ship its H200 products to approved customers in China, and other Countries, under conditions that allow for continued strong National Security. President Xi responded positively!”
Due to the recent surge in demand for AI, Nvidia, the most valued business in the world and the top chipmaker, has had tremendous success. However, this achievement has also put it squarely amid international disputes over who will prevail in the world competition to control artificial intelligence.
Trump added in his statement that “25% will be paid to the United States of America,” potentially suggesting that the US government will receive 25 percent of Nvidia’s sales revenue.
The announcement follows Trump’s meeting with Jensen Huang, CEO of Nvidia, last week. Even while China has made significant investments in its own domestic industry, Trump has often stated that the US must win the global AI race.
In a statement to CNN, Nvidia’s spokesperson said, “We applaud President Trump’s decision to allow America’s chip industry to compete to support high paying jobs and manufacturing in America. Offering H200 to approved commercial customers, vetted by the Department of Commerce, strikes a thoughtful balance that is great for America.”
Additionally, Trump stated that a similar strategy for AMD, Intel, and other US chip makers is being finalised by the Department of Commerce.
An AMD spokesperson told CNN, “AMD commends President Trump’s leadership in finding a thoughtful approach to export policies that allows for US companies to compete globally. The President’s decision strengthens American competitiveness, supports high-value domestic jobs, and drives American investment and growth in the semiconductor industry.”
CNN’s request for comment was not immediately answered by Intel.
Trump made agreements with chipmakers earlier this year, such as Nvidia and AMD agreeing to provide the US government 15 percent of its revenue from chip sales to China, which led to the decision. In August, Trump also announced that the government would purchase 10 percent stake in Intel.