On December 8, Trump announced that he would sell H200 computer chips to “approved customers” in China, with the United States taking 25% of the profits from chips sold to the communist country.
Trump vaguely reassured his audience that the chips would be sold “under conditions that allow for continued strong National Security [sic].” Nvidia announced its full support of the deal. Its CEO, Jensen Huang, enjoys close ties with the Trump administration.
While Huang has claimed that cutting off China from advanced American technology has backfired by incentivizing it to develop its own technological base, he is mistaken. The Institute for Progress found that no artificial intelligence (AI) chip exports to China would allow the United States to enjoy a “21-49x advantage” in AI computation, while even conservative H200 chip exports would reduce this advantage to 4-6.7x. The H200 chip is six times more powerful than the H20 chip.
Additionally, China is unlikely to take the bait of American tech reliance. It called for an investigation of “loopholes and back doors” when Trump announced his offer. Furthermore, China can utilize Nvidia chips “to train models to compete with American frontier variants and continue to invest heavily in domestic alternatives like Huawei’s Ascend chips. When those are good enough, the firms will drop Nvidia—and quickly.”
This decision is hypocritical, as, during his first term, Trump supported chip controls against China.
Nvidia as a platform for corruption
Trump owns $500,000 to one million dollars in Nvidia stock, indicating a conflict of interest. Trump has allowed the United Arab Emirates (UAE), which he has extensive dealings with, to import some of Nvidia’s most advanced chips. Trump’s United States Federal Trade Commission (FTC) enabled Nvidia to purchase a $5 billion stake in Intel; Trump’s administration bought a ten percent stake in Intel. Huang has funded Trump’s White House ballroom.
