Trump Opens the Door Wide, China Gives Unexpected Response
Washington, DC - The United States government has given the green light to 10 Chinese technology companies to purchase Nvidia H200 artificial intelligence (AI) chips. However, as of now, none of these chip shipments have been successfully completed, as Beijing is said to be holding back its domestic companies.
Companies such as Alibaba, Tencent, ByteDance, and JD.com have already obtained permits to purchase the second most advanced AI chip from Nvidia. Even distributors such as Lenovo and Foxconn have received approval from the US government.
Each customer that receives approval can purchase up to 75,000 chips, according to US export license provisions, as quoted by Reuters on Friday (May 15, 2026).
Despite this, the large-scale deal remains uncertain amid the escalating US-China technology rivalry.
According to Reuters sources, Chinese companies have begun to withdraw from their planned purchases after receiving direction from the Beijing government. China is reportedly concerned that dependence on Nvidia chips will weaken their ambition to build a domestic AI chip industry.
Although China’s AI chip technology still lags behind Nvidia, companies such as DeepSeek have begun to emphasize the use of local chips, including those developed by Huawei.
“The Chinese central government has not yet allowed them to buy these chips, because they want investment to remain focused on their own domestic industry,” said US Commerce Secretary Howard Lutnick during a Senate hearing last month.
This situation is a major blow to Nvidia. Before US export controls were tightened, Nvidia controlled about 95% of the market for advanced AI chips in China. The country even contributed about 13% of Nvidia’s revenue.
Jensen Huang had previously estimated that the Chinese AI market would reach a value of US$50 billion this year.
The path to selling H200 chips has also been hampered by various requirements from both countries. US rules issued in January require Chinese buyers to prove that they have installed adequate security procedures and will not use the chips for military purposes.
Nvidia is also required to ensure the availability of sufficient chip stocks in the US.
Trump also negotiated a scheme in which the US would receive 25% of the revenue from the sale of these chips. This scheme requires the chips to first pass through US territory before being shipped to China, as US law does not allow for the direct collection of export fees.
This scheme has raised concerns in Beijing regarding the potential for manipulation or hidden loopholes in the chips, although some sources say the mechanism was mainly created to circumvent legal obstacles.