HamzaWaseem
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At his speech at the annual Computex convention in Taipei on May 21, 2025, Nvidia CEO Jensen Huang publicly blasted U.S export restrictions on artificial intelligence (AI) chips to China, calling them "a failure," Huang clarified that the basic presumptions underlying the AI diffusion rule, which sought to limit China's access to cutting-edge AI processors, have turned out to be incorrect, instead of impeding China's advancement, the limitations have encouraged Chinese businesses to develop indigenous semiconductor technologies more quickly, with substantial government funding.
Huang highlighted that Nvidia’s market share in China has dropped dramatically from 95% at the start of the Biden administration to just 50% today, largely due to these export controls and the rise of Chinese chipmakers like Huawei, the U.S restrictions have forced Chinese firms to rely increasingly on homegrown chips, such as Huawei’s Ascend AI processors, and to build a self-sufficient semiconductor supply chain independent of foreign suppliers. While Huawei’s chips may not yet fully match Nvidia’s capabilities, they are sufficient for many AI applications in China, enabling continued AI research and commercial deployment domestically.
Because of worries about possible military uses, the export restrictions, which were first implemented under President Biden and renewed in late 2024, prohibit the sale of high-performance AI chips and associated production equipment to China, although Nvidia has made an effort to adjust by creating less powerful chips, such as the H20 GPU, to meet US regulations, recent licensing requirements from the Commerce Department have complicated shipments and caused the company to suffer large financial losses, including a $5.5 billion charge for unsaleable inventory.
Huang praised the Trump administration’s recent moves to relax some export restrictions, noting that former President Trump recognized the flawed nature of the previous policy and sought to modify it to better support U.S. companies. He emphasized that AI research in China continues robustly, fueled by domestic chip development and government backing, despite the export curbs.
The Chinese government has denounced U.S export restrictions as discriminatory and detrimental to trade ties, and it has threatened to take strong action if the U.S keeps taking steps that hurt China's interests, to further complicate the global semiconductor market, the U.S Commerce Department has now released guidelines cautioning businesses worldwide against utilizing AI chips manufactured in China, such as Huawei's Ascend.
Huang highlighted that Nvidia’s market share in China has dropped dramatically from 95% at the start of the Biden administration to just 50% today, largely due to these export controls and the rise of Chinese chipmakers like Huawei, the U.S restrictions have forced Chinese firms to rely increasingly on homegrown chips, such as Huawei’s Ascend AI processors, and to build a self-sufficient semiconductor supply chain independent of foreign suppliers. While Huawei’s chips may not yet fully match Nvidia’s capabilities, they are sufficient for many AI applications in China, enabling continued AI research and commercial deployment domestically.
Because of worries about possible military uses, the export restrictions, which were first implemented under President Biden and renewed in late 2024, prohibit the sale of high-performance AI chips and associated production equipment to China, although Nvidia has made an effort to adjust by creating less powerful chips, such as the H20 GPU, to meet US regulations, recent licensing requirements from the Commerce Department have complicated shipments and caused the company to suffer large financial losses, including a $5.5 billion charge for unsaleable inventory.
Huang praised the Trump administration’s recent moves to relax some export restrictions, noting that former President Trump recognized the flawed nature of the previous policy and sought to modify it to better support U.S. companies. He emphasized that AI research in China continues robustly, fueled by domestic chip development and government backing, despite the export curbs.
The Chinese government has denounced U.S export restrictions as discriminatory and detrimental to trade ties, and it has threatened to take strong action if the U.S keeps taking steps that hurt China's interests, to further complicate the global semiconductor market, the U.S Commerce Department has now released guidelines cautioning businesses worldwide against utilizing AI chips manufactured in China, such as Huawei's Ascend.
