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Samyarup Chowdhury
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Nvidiaโs CEO has become a central figure in the U.S.-China technology dispute. BY: Unsplash
Jensen Huang, CEO of California-based chip designer Nvidia, has become a central figure in the U.S.-China technology dispute, persuading both Washington and Beijing to ease restrictions on artificial intelligence chips. Knewz.com has learned that his behind-the-scenes meetings with President Donald Trump and Chinese regulators culminated in an unexpected outcome: the approval for Nvidia to sell its H20 AI chip in China.
Nvidia CEO makes his case to Washington
Huang met several times with Trump to warn that cutting China off from advanced U.S. chips could backfire. BY: MEGA
Huang met several times with Trump to warn that cutting China off from advanced U.S. chips could backfire. He argued that Beijing would accelerate its domestic development if locked out entirely. According to Trump, Huang pledged that Nvidia and its partners would invest up to $500 billion in American factories and research. In return, the administration allowed the H20, a chip specifically designed to comply with earlier restrictions, to be shipped to China. The approval came after a White House meeting in which Trump pressed Nvidia to give the government 20% of its China sales in exchange for issuing the export licenses. โIf Iโm going to do that, I want you to pay us something,โ Trump said. Huang countered with 15% and illustrated his case with a diagram showing how tariffs would be counterproductive for his goal of increasing U.S. chip production. Shortly after, Trump announced tariff exemptions for tech firms investing domestically.
China approves U.S. chip-software deal
China reciprocated by approving a $35 billion deal involving U.S. chip-software firms that it had blocked for about a year. BY: Unsplash
China reciprocated by approving a $35 billion deal involving U.S. chip-software firms that it had blocked for about a year. Chinese regulators also froze an inquiry into an earlier Nvidia acquisition. It has been reported that Huang has made repeated visits to Beijing this year, even as other American executives avoided public ties to Chinese companies. He has met with leaders of Alibaba, Xiaomi, and AI startup MiniMax to reassure them of Nvidiaโs commitment to the Chinese market. Engineers in China have dubbed him the โMagic Tailorโ for designing chips like the H20 to fit within U.S. regulations. โI hope to get more advanced chips into China than H20,โ the Nvidia CEO said during a recent Beijing trip. โWhatever weโre allowed to sell in China will continue to get better and better.โ
Backlash from Congress, rival executives
Rival executives, including Elon Musk, argued against the move. By: ZUMAPRESS.com / MEGA
However, the decision has triggered criticism in Congress, where lawmakers from both parties view advanced chips as a national security risk. Senator Mark Warner and other members of the Intelligence Committee warned Commerce Secretary Howard Lutnick that Chinaโs commercial AI advances, helped by Nvidia, are โquickly translating into a national security advantage for the Peopleโs Liberation Army.โ Rival executives, including Elon Musk, also argued against the move. Musk cautioned that supplying China with more powerful chips undermined U.S. dominance in AI. However, Huang countered that the H20 is only capable of โinferenceโ work, not large-scale model training. โThey simply canโt rely on it,โ he said in a televised interview.
What is at stake for Nvidia
Nvidiaโs market share in China has fallen sharply under U.S. restrictions. BY: Unsplash
According to reports, Nvidiaโs market share in China has fallen sharply under U.S. restrictions, from 95% to about 50%. At stake is tens of billions in sales, as well as the companyโs position in a market that fuels much of global demand for AI. Trumpโs decision to permit H20 sales is a departure from the national security-first approach taken in his first term and under President Joe Biden, when the prevailing trend was generally tougher control on tech sales to China. Administration officials have portrayed the move as part of a broader effort to balance national security with economic growth. โPresident Trump regularly talks to business leaders like Jensen Huang who are making historic investments in American manufacturing,โ White House spokesperson Kush Desai said. โThe only special interest guiding the presidentโs decision-making is the best interest of the American people.โ
The post CEO promises billions to dodge China-U.S. trade war appeared first on Knewz.
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