The Trump administration has allowed Nvidia to sell a lower-level AI chip, H20, to China, reversing a ban imposed just three months ago. This move marks a significant shift in the US approach towards China, as officials prioritize wooing Beijing over more aggressive actions.
The decision came after President Trump banned China from accessing the H20 chip and imposed triple-digit tariffs on Beijing, sparking an economically perilous trade clash. China retaliated by clamping down on exports of critical minerals and magnets to American factories.
Now, the administration is reportedly putting more aggressive actions against China on hold, focusing instead on positive moves that will be perceived as beneficial by the Chinese. This reversal was driven by top Trump officials who believed selling the H20 chip would strengthen American technology leadership.
The US decision to relax controls on AI chips marks a significant shift in its approach towards China. As the world’s largest economies navigate their complex relationship, it remains to be seen how this move will impact the global balance of power and trade dynamics.
Source: https://www.nytimes.com/2025/07/20/us/politics/trump-china-technology.html