Trump has indeed taken further action. Late last night in Beijing time, NVIDIA informed the public that it will need approval from the Ministry of Commerce to export all H20 GPUs to China. NVIDIA further stated that this licensing requirement will be "indefinitely valid".

The H20 is a "cut-down" GPU specifically designed by NVIDIA for the Chinese market. Last year, NVIDIA's exports to China reached $17 billion. The H20 and its earlier version, the H800 (also a "cut-down" chip of the H100), supported the majority of China's artificial intelligence models. DeepSeek used both the H20 and the H800. Rui Ma, founder of American consulting firm Tech Buzz China, said that if these restrictions persist, it is expected that the AI semiconductor supply chains between the U.S. and China will become "completely decoupled".

▲NVIDIA CEO Jensen Huang (archive photo)

Banning NVIDIA from selling advanced GPUs to China began during the Biden administration. It was a product of the Biden administration's efforts to restrict China's AI development following the global AI large model craze sparked by OpenAI in 2022. The Biden administration tightened NVIDIA's sales of GPUs to China twice. The H800 had only about 70% of the functionality of the H100 after being "cut down", but was later banned. The H20 has even lower functionality. However, during the Biden era, NVIDIA did not need permission from the Ministry of Commerce to sell "cut-down" chips to China. What the Trump administration is doing now is effectively closing the last door for NVIDIA's sales to China.

The clear purpose of the new regulations by the Trump administration is to strangle China's throat and suffocate the development of China's artificial intelligence. This will certainly have some impact and create new difficulties for China. However, Hu noted that after this news spread in China on Wednesday, it did not cause much of an uproar. Its sensational effect was even less than a relatively vague news from the White House stating that "the maximum tariff on Chinese goods could reach 245%". Do the Chinese people not realize the implications of the new restrictions by the U.S.? It may not be the case. Many Chinese people, including professionals in the industry, might believe that China's AI infrastructure has already formed a scale, and Chinese engineers have found ways to save GPU computing power. Therefore, most Chinese people do not believe that Trump's move can truly strangle China's artificial intelligence.

▲In March this year, Huang Renxun attended NVIDIA's annual software developer conference (video screenshot)

Moreover, Huawei's Shengteng and Kirin series chips have already been put into commercial use. The Shengteng 910 series has been installed in several large models. Although some people believe that the quality of Huawei's chips is weaker than that of NVIDIA's "cut-down" chips, whether this is true or not remains unclear. However, it is certain that Shengteng can replace NVIDIA's related chips. According to market analysis, the tighter the import of NVIDIA chips is managed, the larger the application market for China's domestic GPUs will be, and their progress and iteration speed will also accelerate. From a strategic perspective, America shutting the door on NVIDIA exports is a spur and encouragement for the accelerated progress of Huawei and other domestically produced GPUs in China.

It cannot be denied that China's overall calmness is reasonable. Over the past seven years, China's information industry has grown stronger, and this trend will continue. Chinese people's confidence is supported by facts and experience.

Therefore, the one who is most anxious now is NVIDIA. They have consistently strongly opposed the U.S. ban on exporting GPUs. The New York Times reported that if NVIDIA exits the Chinese market, they fear that their chip sales business will be handed over to Huawei, a leading Chinese AI chip manufacturer, which will begin to challenge their global sales share. Patrick Moorhead, an analyst at U.S. technology consulting firm Moor Insights & Strategy, said, "This cuts off NVIDIA's access to a key market, they will lose momentum in China. Ultimately, Chinese companies will turn to Huawei."

America's method of strangling China's neck is through chips, but Washington definitely cannot strangle us. On the contrary, China has started to strangle America's throat, and our tool is rare earth elements.

Advanced chip production itself depends on rare earth elements. Gallium and indium in rare earths are critical materials for manufacturing semiconductor chips. Although chips are not the largest consumer of rare earth elements, rare earths, through innovations in materials science, permeate key stages of chip manufacturing, from polishing, transistor design to heat dissipation. Their unique properties have driven the advancement of semiconductor technology, making them an indispensable hidden pillar of modern chip industries.

China's Ministry of Commerce announced in December last year a ban on exporting gallium, germanium, antimony and other key materials to the United States. On April 4th of this year, it implemented export controls on heavy rare earth-related items. Since China dominates the rare earth field, producing 90% of the world's rare earths and processing over 99% of them, American cutting-edge manufacturing, including defense industries, rely on rare earths. As China's "killer锏", the grip on America's "lifeline" is no less significant than America's threat to China with chips as its "weak point".

In particular, China's chip technology continues to advance, with progress every one or two years. The potential connection between China's existing chip stock and domestic capacity is expected to be realized. Meanwhile, America's rare earth reserves are widely analyzed to only last for a few months, and their huge gap will be difficult to make up in the short term, making the problem more urgent.

Trump ordered a tariff investigation on all critical mineral imports from America on the 15th to "assess the impact of these material imports on America's security and resilience". The arrogant Americans reacted much slower to the crisis than China. Our efforts to solve the chip issue have been accelerating since the last round of trade war and continue to this day; America's efforts to solve the rare earth issue have been intermittent and have not yielded significant results. Trump would not solve this problem even in his second term.

The mutual strangling of throats between China and America, time will prove who will run out of breath first. China has the confidence to laugh till the end.

Original article: https://www.toutiao.com/article/7493894955241456143/

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