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Jensen Huang certain appears to be having a whole lot of enjoyable in China this week. The Nvidia CEO has been noticed going for a leisurely bike trip and searching a recent fruit stand in Shanghai, in addition to having fun with beef sizzling pot at a humble restaurant in Shenzhen.
The carefree tour isn’t just good optics. Huang has actual cause to be feeling upbeat: His long-running lobbying marketing campaign in Washington has, in impact, lastly paid off. Whereas Huang was gallivanting round China, a number of information retailers reported that Beijing had authorised the sale of lots of of 1000’s of highly effective Nvidia H200 AI chips to Chinese language corporations.
Based on Reuters, China has agreed to permit ByteDance, Alibaba, and Tencent to purchase greater than 400,000 of the chips in whole beneath conditional licenses granted throughout the Nvidia CEO’s go to. Extra approvals are anticipated within the coming weeks. (Nvidia and the tech corporations didn’t instantly reply to requests for remark.)
The purported chip gross sales are the fruits of a surprising American coverage reversal over the previous 12 months. Below the Biden administration, the US sharply tightened export controls on high-end AI chips and barred fashions such because the H200 from being bought to Chinese language clients attributable to nationwide safety issues. The restrictions have been meant to restrict Beijing’s means to develop highly effective synthetic intelligence techniques with army or different delicate functions.
However beneath President Trump, a distinct logic—promoted by Huang and White Home AI and crypto czar David Sacks—has prevailed. They argued that permitting China entry to some American AI chips was higher than ceding such a big and vital market completely to Chinese language chipmakers, each economically and since it will theoretically hold Chinese language corporations depending on US know-how.
In current inside discussions, White Home officers have additionally justified the H200 gross sales by pointing to the continued smuggling of superior chips into China, which they argue proves US restrictions have been ineffective, in keeping with two individuals conversant in the matter. The officers contend that permitting restricted, regulated gross sales is preferable to an opaque grey market that provides US authorities little visibility into the place the chips might in the end find yourself.
“The Trump administration is dedicated to making sure the dominance of the American tech stack—with out compromising on nationwide safety,” White Home spokesperson Kush Desai mentioned in a press release.
It’s not simply Huang and the Trump administration which might be probably strolling away completely happy right here. By permitting home corporations to purchase H200 chips in restricted portions, Beijing has the chance to realize two strategic objectives directly, says Samuel Bresnick, a analysis fellow at Georgetown’s Heart for Safety and Rising Know-how.
China’s home tech champions can now get entry to the compute they desperately want to coach highly effective, near-frontier AI fashions on par with the newest choices from OpenAI and different American labs. However by holding tight management over who will get to purchase Nvidia’s {hardware}, Beijing helps guarantee demand for Huawei chips stays excessive and there are nonetheless sturdy incentives for corporations to proceed constructing out China’s home semiconductor ecosystem.
That end result is “wonderful proof that this David Sacks concept of holding China hooked on American know-how is simply not how that is going to go,” says Bresnick. “I see this as proof that China is completely uncomfortable with the thought of letting its personal burgeoning chip business be swamped by Nvidia.”
However the actual harm could stem from the whiplash in Washington. For years, policymakers have despatched combined alerts about what the US needs to perform with chip controls, and China has been watching intently. “The worst attainable factor we will do is simply trip,” says Bresnick. “We’ve already given China the crucial to get their very own chips going whereas additionally giving them entry on the identical time.”
Up to date: 1/29/2026, 11:03 am PST: This story has been up to date with remark from the White Home.
That is an version of Zeyi Yang and Louise Matsakis’ Made in China publication. Learn earlier newsletters right here.
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