Trump Administration Begins Review to Approve Nvidia AI Chip Sales to China
The Trump administration has initiated a review process that could pave the way for the first shipments of Nvidia’s second-most powerful artificial intelligence (AI) chips, the H200, to China. The move marks a significant policy shift and follows President Donald Trump’s recent pledge to permit such sales under strict conditions.
Earlier this month, Trump said his government would allow Nvidia to sell its H200 chips to Chinese customers, subject to a 25% fee paid to the U.S. government. He argued that enabling controlled exports would sustain the global leadership of U.S. chipmakers while reducing Chinese demand for domestic alternatives.
Inter-Agency Review Underway
According to five sources familiar with the matter, the U.S. Commerce Department has submitted license applications for the proposed sales to the State, Energy, and Defense Departments for review. These agencies have 30 days to respond before a final decision, which ultimately rests with the president.
One administration official emphasised that the process would be comprehensive rather than symbolic, describing it as “not some perfunctory box we are checking.” Neither Nvidia nor the Commerce Department responded to requests for comment, while a White House spokesperson reiterated that the administration remained committed to maintaining “the dominance of the American tech stack – without compromising national security.”
Policy Reversal from Biden-Era Restrictions
The Biden administration had previously barred exports of advanced AI chips to China and certain intermediary countries over concerns they could be diverted for military use. Trump’s decision to reconsider those restrictions represents a marked departure from his predecessor’s stance and contrasts with his own first-term policy, which targeted China’s access to U.S. technologies over alleged intellectual property theft and security risks.
Critics argue that loosening restrictions could undermine U.S. strategic interests. Chris McGuire, a former National Security Council official under President Biden, said exporting such chips would be “a significant strategic mistake,” describing the H200 as “the one thing holding China back in AI.”
Balancing Commerce and Security
Supporters within Trump’s team, led by White House AI adviser David Sacks, maintain that allowing limited exports discourages Chinese firms like Huawei from investing heavily to rival Nvidia and AMD’s most advanced chip architectures. They contend that selective engagement could help sustain American market dominance while managing the security risk.
Reports indicate Nvidia plans to ramp up production of the H200 following strong interest from Chinese customers. Although the chip trails the company’s latest Blackwell model in performance, it remains a vital component in global AI infrastructure.
Trump previously considered permitting exports of a restricted version of Nvidia’s Blackwell chips but later opted to approve the H200 instead—a move seen as a middle ground between commercial opportunity and national security caution.
with inputs from Reuters