Chinese regulators reacted to US Trade Minister Howard Lutnick’s statements. Lutnick’s statements were described as “insults ında in Beijing. Thereupon, Chinese -based technology companies were warned to stay away from the Nvidia H20 artificial intelligence chips.
The US banned the sale of the H20 model in April of this year. The reason was the concern that chips could be used by the Chinese army in the field of artificial intelligence. In July, restrictions were removed and the shipments were allowed to start again. Nevertheless, Lutnick said in a statement at CNBC that China was not given the most powerful products. These words found a political and economic response in Beijing.
China warned companies for the cancellation of Nvidia H20 orders
Lutnick’s statements caused Chinese institutions to take harder steps. Cyber Space Administration sent an informal notification to giants such as Alibaba and ByTedance. These companies were asked to stop H20 orders and the national security review came to the fore. It was emphasized that those who do not comply with the instruction may face heavy fines. For this reason, it was not possible for technology companies to remain indifferent to the calls in this direction.
A similar warning was made by the National Development and Reform Commission. Local companies were advised not only to stay away from all Nvidia chips, not only the H2Y. Thus, state institutions met in the same line and the issue turned into a political determination. In addition, the pressure on domestic chip production has become more visible. However, in the short term, dependence on the outside did not disappear.
In this process, China’s artificial intelligence capacity is on a critical threshold. High -performance chips are still needed for artificial intelligence systems. Companies have to access strong equipment in order not to fall behind in global competition. Nevertheless, the government’s guidance restricted the interest of foreign suppliers. In addition to all these, the incentives allocated for domestic production have increased.
According to Reuters, Nvidia is working on a new chip. This model, which was developed based on Blackwell architecture, will be stronger than the H20. However, Blackwell Ultra GPUs will only offer as much as half of the trading capacity. Approval processes have not yet been completed and the shipment will take time. This shows that the technology tension between the US-China will continue in the chip market.
The US administration is allegedly aware of this new product. It is said that the President will directly meet with Nvidia CEO Jensen Huang. This meeting may be decisive for the future of the company in China. However, there is no finalized decision yet. On the other hand, this process will affect the company’s strategies in the global market.
China’s chip moves are not only reaction, but also about the search for a transformation. Huawei’s Ascend series processors and Alibaba’s own solutions were an indication of this. Beijing administration aims to reduce dependence on foreign suppliers in the long run. However, it will not be easy to establish a strong ecosystem. Despite everything, the direction of investments has become clear.
In the short term, Chinese companies need foreign chips. Manufacturers like Nvidia continue to be an important player in the country despite all restrictions. On the other hand, as domestic alternatives develop, the balances are gradually changing. This change reveals new forms of competition in the chip market. In addition to all these, technology independence becomes a priority target for Beijing.