The United States and China have been engaged in a prolonged dispute over the export of advanced semiconductors, with significant implications for the development of artificial intelligence. Recently, US President Donald Trump announced that the country has agreed to allow chip giant Nvidia to sell AI semiconductors to China. This decision marks a notable shift in the US approach to the issue.
The US-China chip war began in August 2022, when President Joe Biden signed the Chips and Science Act, aimed at boosting domestic chipmaking and reducing reliance on foreign suppliers. The act included $52 billion in funding to support the production of microchips, which are essential for various modern technologies. In October 2022, the US imposed export controls on advanced chips used in artificial intelligence, citing national security concerns.
Over the next year, the US continued to tighten restrictions on chip exports to China. In October 2023, the US expanded export curbs to include lower-performing semiconductors. Ahead of Trump’s return to the White House, the Biden administration imposed new rules on advanced chip exports to China, requiring authorizations for re-exports and in-country transfers.
The US decision to allow Nvidia to sell AI semiconductors to China comes after a series of developments that underscored the complexity of the issue. In January 2025, Chinese startup DeepSeek launched a low-cost, high-quality chatbot, challenging US ambitions to lead the world in AI development. Nvidia had developed new H20 semiconductors, designed specifically for export to China, but the US government required the company to obtain licenses to ship them.
The Trump administration’s decision to ease some Biden-era chip export controls has significant implications for the global tech industry. Trump’s agreement with Chinese President Xi Jinping to allow Nvidia to ship H200 chips to approved customers in China marks a notable development in the US-China chip war. The H200 chips are roughly 18 months behind Nvidia’s most advanced offerings, and the company’s most advanced chips remain available only to US customers.
The US-China chip war highlights the intense competition between the two countries in the field of artificial intelligence. As the global tech industry continues to evolve, the dispute over advanced semiconductors is likely to remain a key issue, with significant implications for the development of AI and other emerging technologies. The latest developments in the US-China chip war will be closely watched by industry leaders and policymakers around the world.
