U.S. export controls have so far helped American chip companies maintain technological dominance over Chinese ones, a technology policy expert said this week, which suggests the Trump administration should rethink its decision to allow sales of H20 chips to China (see 2507150013).
The head of a tech policy nonprofit urged the leaders of three congressional committees Aug. 7 to hold a hearing to examine the “large-scale smuggling” of advanced American AI chips into China in violation of U.S. export controls.
Nvidia chips don’t have and shouldn’t be required to have so-called “kill switches” that would allow exported chips to be remotely disabled without the user’s consent, the semiconductor company said this week.
The U.S. last week arrested and accused two Chinese nationals of using a California-based company to illegally export tens of millions of dollars' worth of advanced AI semiconductors to China, including by first transshipping the chips through Malaysia and Singapore.
U.S. allies, including in Europe, may back away from their plans to de-risk from China if they continue to see the Trump administration use export controls as a bargaining chip in trade negotiations with China, a panelist said during an event this week hosted by the Center for a New American Security. Others said they’re skeptical about the sustainability of the trade deals announced by the U.S. last week, especially those that commit other countries to large purchases of American goods.
The Trump administration plans to maintain strict China-related export controls on the most advanced semiconductors and chip manufacturing equipment, a senior White House official said last week, adding that the U.S. also doesn’t plan to automatically greenlight all H20 chip exports to China.
China's Cyberspace Administration is probing U.S. semiconductor firm Nvidia after raising concerns that the company's chips may be equipped with features to track the location or potentially shut down H20 chips sold in China, the agency said July 31, according to an unofficial translation.
The Trump administration appears to be avoiding new China-related controls on sensitive semiconductor manufacturing equipment because it fears those restrictions could impede a trade deal, a technology policy researcher said this week. Other researchers said the administration isn’t using its chip bargaining power correctly, adding that the U.S. should be getting more for the deals it has made so far with Gulf nations and potentially others in the future.
Senate Foreign Relations Committee ranking member Jeanne Shaheen, D-N.H., asked the Trump administration July 30 to provide more information about its decision to allow Nvidia to sell H20 AI chips to China, including what “guardrails” it has put in place to ensure that the exports don’t help modernize the Chinese military.
Treasury Secretary Scott Bessent told reporters in Stockholm, Sweden, that the Chinese delegation spoke too early when they said the two sides agreed to another 90 days at current tariff levels, because the president is the one to decide. However, in a later interview with CNBC, Bessent said the meetings had been "highly satisfactory."