Nvidia CEO: US Chip Export Controls Misfire by Boosting China’s Progress

Jensen Huang, head of Nvidia, stated that US chip export controls are a “fail” during his remarks at the High-Tech Forum on Wednesday.

In an effort to limit China’s military advancements and maintain US dominance in the AI sector, successive US administrations have placed restrictions on the sale of advanced AI chips to China. However, Huang indicated at the Computex Tech forum in Taipei that these controls have inadvertently motivated Chinese developers.

“The local companies are exceptionally skilled and highly motivated, and export control has provided them with the momentum, energy, and governmental backing to speed up their progress,” Huang shared at the Computex Tech Show in Taipei.

“On the whole, I believe export control has been a failure.”

“It’s crucial to acknowledge that China boasts a dynamic technological ecosystem, with 50% of the world’s AI researchers, and excels in software development,” Huang emphasized.

Nvidia, known for its high-performance GPUs, faces challenges due to US chip export regulations. Huang mentioned on Wednesday that the company has incurred “billions of dollars” in losses, with its share of the AI chip market in China plummeting from nearly 95% to 50% since the Biden administration took office.

According to the Financial Times, Huang made an unannounced trip to Beijing last month.

This visit took place shortly after new US restrictions prohibited the shipment of Nvidia’s H20 Datacentre GPU to China.

The US government informed NVIDIA that the new regulations aim to mitigate the risk of the product being “used in Chinese supercomputers.”

Huang’s Beijing conference reportedly focused on the AI company’s latest chip design, as per the FT report.

Last week, the Trump administration rolled back certain existing controls on chip sales to China after several countries expressed that they were being excluded from the essential technologies required for AI development.

Nonetheless, they issued new guidelines for other nations, warning that utilizing high-tech AI semiconductors produced in China, especially chips from Huawei, could breach existing US export regulations.

In retaliation, China accused the United States of “misusing export controls to suppress and restrict China.” The Commerce Department stated on Wednesday that the warning exemplifies “unilateral bullying and protectionism, significantly jeopardizing the stability of the global semiconductor industry and supply chains.”

Moreover, it cautioned that organizations or individuals enforcing or supporting such actions might be violating Chinese law.