U.S. Grants AI Chip Clearance to Chinese Firms Amid Tech Tensions

Several Chinese companies including ZTE Corp have been approved by the U.S. to purchase advanced AI chips from Nvidia and AMD. This move highlights the ongoing tech rivalry between the U.S. and China, as China seeks domestic alternatives amidst export restrictions on AI technology.

A unit of telecom equipment manufacturer ZTE Corp, along with two other Chinese firms, has recently received approval from the U.S. to purchase advanced AI chips from Nvidia and AMD, according to insiders and documentation. Nvidia's H200 chip, renowned for its capability in training and deploying large AI models, has become a central issue in the tech rivalry between the United States and China, with Washington trying to prevent China from obtaining advanced computational capabilities.

The approval, which has not been previously reported on, expands the range of Chinese companies authorized to engage in licensing agreements beyond the nation’s major internet and electronics distributors. The U.S. had previously permitted around 10 other Chinese companies such as Alibaba, Tencent, ByteDance, and JD.com to acquire these chips, though such transactions were previously stalled due to approval and scrutiny from both the U.S. and China. However, some Chinese cloud services have recently informed partners that they expect to procure the H200 chips soon, suggesting progress in compliance with Chinese import regulations.

None of the involved companies, including ZTE, Nvidia, and the respective government agencies, have commented regarding this development. The U.S. Bureau of Industry and Security, responsible for monitoring export laws, also refrained from comment. Since 2022, Washington has been incrementally increasing control over AI chip exports to China, citing concerns over military enhancements. Nonetheless, exceptions like the H200 have been allowed in instances believed to bolster U.S. technology leadership, despite China's push for self-reliance stirring uncertainties about these deals' future, even post-U.S. license approvals.