President Donald Trump decides to buy US tech giant Nvidia Selling more advanced semiconductors to China has faced pushback from some Republicans wary of giving China an edge in the global race for AI supremacy.
The agreement, announced by President Trump in a Truth Social post on Monday night, allows Nvidia to sell its H200 artificial intelligence chip to China on the condition that the U.S. government gets 25% of the sales.
The H200 chip isn’t Nvidia’s most advanced chip, but it’s more powerful than the company’s H20, which was previously developed specifically for the Chinese market.
The White House spent the summer working with NVIDIA. advanced micro device It sells inferior chips to China in exchange for 15% of sales revenue. The Chinese government has reportedly told companies not to buy these chips.
Trump said in a social media post that Chinese President Xi Jinping had “reacted positively” to the latest proposal.
CNBC has reached out to the Chinese embassy in Washington, D.C., for comment.
Experts have warned that giving China access to better chips would reduce America’s hardware advantage and help Chinese developers vastly improve AI models and other technologies.
Some of Mr. Trump’s Republican supporters seem to agree.
“There are alarm bells going off in my head here,” Sen. Lindsey Graham, R-S.C., told CNBC on Tuesday when asked about the semiconductor sales deal.
“I don’t mind doing normal business with China, but if this can be shown to accelerate China’s military power, then I would object,” Graham said.
“My general view on this is that China’s AI advances are almost entirely parasitic on our technology, especially our hardware,” Sen. Josh Hawley, R-Missouri, said on Capitol Hill early Tuesday.
“So I don’t want China to win the AI race. I want to win the AI race,” Hawley said. “But I think if you want to beat China, you’re going to have to limit China’s ability to leverage its own technology. And you’re going to want to have less access to Chinese hardware, not more.”
Hawley did not directly criticize President Trump, but noted that the president knows more about the situation than he does. “So I think he deserves some respect here,” Hawley said.
“But as a general matter, I would like to restrict American hardware from being exported to China,” he added.
Sen. John Cornyn (R-Texas) asked about the tipping deal and gave a more succinct answer.
“I’m worried,” he said. Mr. Cornyn did not respond to subsequent questions.
Hawley’s concerns were echoed by the U.S. House of Representatives Select Committee on China, a Republican-led committee created to focus on the “threat posed by the Chinese Communist Party.”
“China currently lags far behind the US in the chips that drive the AI race,” the commission said in a statement on X. “The H200 is far superior in both power and scale to anything China can produce domestically, so @nvidia selling these chips to China will help it catch up with the US in total computing.”
The Chinese government plans to use the H200, which boasts significantly more processing power and memory bandwidth than China’s top chips, to “enhance its military capabilities and totalitarian surveillance,” the committee said in a statement.
“Finally, NVIDIA must have no illusions: China will steal its technology, mass produce it on its own, and try to end NVIDIA as a competitor,” the committee said. “This is China’s strategy, and they are using it in every important industry.”
Asked for comment on the Republican senator’s remarks, White House press secretary Khush Desai told CNBC: “The Trump administration is committed to securing the superiority of America’s technology stack without sacrificing national security.”
Not all Republicans are trying.
“I don’t really have a problem giving them (tips),” Sen. Thom Tillis, R-N.C., told CNBC. “But we need to know where it is, how they’re using it, things like that.”
But there is vocal support on both sides for slowing China’s ability to acquire the world’s best chips.
Sen. Pete Ricketts (R-Neb.) introduced a bipartisan bill last week that would direct the Trump administration to deny export permits for advanced chips to China and other foreign adversaries for at least 30 months.
“The best AI chips are manufactured by American companies. Denying the Chinese government access to these AI chips is essential to our national security,” Ricketts said in a press release announcing the bill.
“To win the AI race, it is critical that we protect American AI innovation from Communist China,” said Sen. Tom Cotton (R-Ark.), one of the bill’s co-sponsors.
Democrats are sounding the alarm over the Trump administration’s efforts to sell better AI chips to China.
Senate Intelligence Committee Vice Chairman Mark Warner (D-Va.) criticized the Trump administration’s “ad hoc, transactional approach to export policy,” saying it “risks squandering U.S. AI leadership and handing the top and bottom of the AI stack to the People’s Republic of China.”
Sen. Elizabeth Warren (D-Mass.) highlighted the fact that just before President Trump announced the H200 deal, the Justice Department touted a crackdown on “a major Chinese-linked AI technology smuggling network.”
“President Trump is having NVIDIA export cutting-edge AI chips that his Justice Department has revealed are being illegally smuggled to China,” she wrote in X.
“His own Justice Department referred to these chips as ‘building blocks for AI superiority,'” she noted.
Warren also said she wants President Trump and Secretary of Commerce Howard Lutnick to “give answers to Congress about why they would abandon our national security.”
—CNBC’s Mary Catherine Wellons and Justin Papp contributed to this report.
