Trump allows Nvidia to sell powerful H200 to China, provided payment to Washington

nvidia h200

The US president once again allows Nvidia to sell ultra-powerful AI accelerators to China, after a previously imposed ban. The export of the chips no longer poses a threat to national security, but only if Nvidia shares the profits.

Nvidia is once again allowed to sell H200 accelerators to China. This is a remarkable development. The Nvidia Hopper H200 is one of Nvidia’s most powerful chips, only surpassed by the latest Blackwell generation. The previous US president Biden had restricted the export of these high-end GPUs due to their strategic importance. Providing China with GPUs of a caliber it cannot develop itself was thought to jeopardize US national security.

In April, President Trump went a step further and imposed a ban on the export of the Nvidia H20. The H20 is a cut-down AI accelerator that Nvidia specially developed to stay within the limitations of the existing export ban. At that time, the reasoning was that the H20 was still too powerful. China could, for example, use the chip to train AI that competes with what is being developed in the US. The move was a heavy financial blow for Nvidia. The ban was later withdrawn.

National security vs. money

Now Trump is completely reversing course. Suddenly, Nvidia is allowed to export the full-fledged H200 to China again. Concerns about national security, which even made the export of the H20 impossible, are no longer mentioned.

Reading between the lines, one might suspect that national security was never a factor for Trump. With the ban on the export of the H20, the US government hurt Nvidia. With a license to sell the full H200, an enormous market potential immediately emerges.

However, Nvidia doesn’t get the export license for free. US national security is not compromised as long as Nvidia hands over 25 percent of the proceeds from Chinese sales to the government. AMD and Intel can also sign up for this arrangement inspired by The Godfather: when they pay sufficient protection money to the US government, the use of their chips in China is no longer a threat to national security either.

Trump also shares that President Xi in China has ‘responded positively.’ What that means is unclear. In response to earlier restrictions, Xi had imposed a ban on the purchase of Nvidia chips by large tech companies. It’s unclear whether that ban will now be lifted entirely.