Most major AI technology companies in China want to buy extremely powerful artificial intelligence chips. But now a report has emerged that complicates everything. According to information from Reuters, Chinese customs authorities told customs agents this week that Nvidia H200 chips are not permitted to be imported into China. This means that these chips, which are among the world's most powerful for AI, will not be allowed across the border for now. Sources speaking anonymously due to the sensitivity of the matter say that government officials also convened meetings with domestic technology companies, where they explicitly instructed them not to buy these chips unless absolutely necessary.
These directives come as the US government under President Donald Trump only formally approved exports of the H200 to China this week, albeit subject to certain conditions. Sources say that Chinese authorities gave no reasons for their decisions, and it is unclear whether this is a permanent ban or merely a temporary measure. Reuters attempted to contact China's General Administration of Customs, the Ministry of Industry and Information Technology, and the National Development and Reform Commission, but received no responses. Nvidia likewise did not respond to inquiries.
H200 Chips
The H200 is Nvidia's second most powerful AI chip and has become one of the biggest points of contention between the US and China. There is enormous demand for it among Chinese companies, but Beijing may want to support its own chipmakers, such as Huawei with its Ascend 910C. Although this domestic chip is advanced, sources say the H200 is far more efficient for training large AI models—it offers roughly six times the performance of the weaker H20 version, which the US banned last year and later approved, but which China has also effectively blocked since August.
Analysts such as Reva Goujon of the Rhodium Group research firm suggest that Beijing may be using these restrictions as leverage in negotiations with Washington, especially ahead of Donald Trump's planned April visit to Beijing, where he will meet Xi Jinping. Chris McGuire of the Council on Foreign Relations think tank adds that China believes the US is desperate to sell AI chips, giving Beijing an advantage in securing greater concessions on technology controls. White House AI expert David Sacks argues that exporting such chips to China prevents Chinese competitors from trying to catch up with Nvidia in the most advanced designs.
Market Impact
Chinese technology companies have ordered more than two million H200 units, each priced at around $27,000 (approximately CZK 621,000 at the current exchange rate). This exceeds Nvidia's inventory of 700,000 chips, demonstrating enormous interest. Nvidia CEO Jensen Huang said last year that the company's share of China's AI chip market had fallen to zero due to previous restrictions. If the H200 were to reach the Chinese market, it would generate enormous profits for both Nvidia and the US government, which collects a 25% fee on sales.
According to a report from The Information, the Chinese government told some technology companies this week that it would approve H200 purchases only in special cases, such as for research and development conducted in partnership with universities. Sources confirm that exemptions for these purposes are being discussed. However, it is unclear whether the directives also apply to existing orders or only to new ones.
Since 2022, the US has restricted exports of high-end chips to China in order to slow its progress in AI and technology. Many US hawks fear that the H200 could strengthen the Chinese military and undermine America's advantage in AI. On the other hand, if China bans the H200, it will strengthen domestic manufacturers such as Huawei. The question remains who will emerge victorious—Nvidia with enormous sales, or Chinese companies with their own innovations. Everything now hangs in the balance as both sides negotiate over trade.
