Key Points
- Beijing has reportedly asked Chinese tech firms to stop ordering Nvidia’s H200 chips.
- The goal is to force companies to buy domestically produced AI chips instead.
- This comes shortly after the U.S. government approved the sale of these chips to China.
- The move could hurt Chinese tech companies’ ability to compete in the global AI race.
China is reportedly telling some of its biggest tech companies to stop buying powerful artificial intelligence chips from Nvidia. According to a new report from The Information, Beijing has asked firms this week to halt new orders for the H200 chip, Nvidia’s second-most advanced processor.
This move appears to be a major step in China’s push to build its own self-sufficient technology industry.
The report suggests the government may soon mandate that companies such as Alibaba and ByteDance purchase a specified amount of domestically produced AI chips. This would force them to support local champions, even if their technology is not as advanced as Nvidia’s.
This news is a major twist in the ongoing chip saga. Just a few weeks ago, the Trump administration announced it would allow Nvidia to sell these chips to China, provided the company paid a 25% fee to the U.S. government.
Beijing’s new directive seems to be a direct rejection of that offer, signaling that China is willing to sacrifice short-term access to the best technology for its long-term strategic goals.
The decision puts Chinese tech giants in a tough spot. They need the best hardware to stay competitive in the global AI race, but they can’t ignore a directive from Beijing. For Nvidia, this could mean the loss of a massive, lucrative market that was just about to open.
