The White House’s artificial intelligence czar has revealed that the decision to resume the sale of Nvidia chips to China is aimed at curbing Huawei’s growth in the AI sector.
According to Business Insider, after a months-long pause, the U.S. government has once again allowed Nvidia to export its AI chips to China. Now, David Sacks, the White House official overseeing AI and cryptocurrency policy, has stated that permitting Nvidia to resume chip sales in China is a strategic move to contain Huawei.
U.S. Hopes to Curb Huawei’s Growth by Selling Nvidia Chips
In an interview with Bloomberg, Sacks said:
“There’s a compelling argument here that you shouldn’t just hand over the entire Chinese market to Huawei, especially when Nvidia, using an older and less powerful chip, can still compete for a significant portion of that market.”
On July 14, Nvidia announced in a blog post that it is submitting a request to resume sales of its H20 graphics processor to Chinese customers. The H20 chip is specifically designed for the Chinese market and was developed by Nvidia to comply with U.S. export restrictions. The chip is intentionally designed to be technologically inferior compared to Nvidia’s other offerings.
The Trump administration previously declared that Nvidia would need special export licenses to sell the H20 chips to China. In its recent statement, Nvidia said the U.S. government has assured the company that the required licenses will be granted, and the company hopes to begin shipping soon.
Nvidia had earlier warned that it expected to lose $5.5 billion in revenue due to restrictions on chip sales to China. According to David Sacks, the U.S. government’s shift in position is “nuanced” and appears “completely reasonable” when considering the threat posed by Huawei. Sacks also stated last month that overly strict export controls on chips could harm rather than help the U.S.’s technological leadership.
