Analysis: US Concerns Over Nvidia Chips Helping China's Military
A new report says Nvidia helped China's DeepSeek hone AI models later used by the Chinese military. Lily LaMattina speaks with Olivia Shen from the United States Studies Centre at the University of Sydney about renewed national security concerns and restrictions.
Security Concerns Over US Chip Exports to China
REPORTER:
I think it certainly cements the existing US security concerns about chip exports to China. This is not the first time that Congressman Moolenaar has written to Commerce Secretary Lutnick about those concerns. Effectively, he is saying that irrespective of how you try to control the licensing at the point of export, it's incredibly difficult to control how the chips will actually be used downstream. You basically lose the line of sight to what's happening with those chips once they exit your borders.
But honing in on this now, at a time when the first batch of H200 have been cleared for export to China.
I think the timing is also pretty significant.
I understand that Nvidia is investing in location verification technology to counteract the risk of chips being smuggled into locations where they were not originally exported to. There is also something that the congressman has actually raised previously, which is to change the way that export controls are pegged. So currently, US export controls very much see US capabilities as the baseline. So it's okay to export chips that are below the level of US capabilities. But what Molinaro suggested previously is you should actually shift that lower, set the threshold lower so that China can only receive chips that are slightly above their current domestic capabilities.
I think Nvidia's assessment is absolutely true. The Chinese do not want to be reliant on us, US made or US exported chips.
That being said, I think the argument is absolutely also very convenient from Nvidia's point of view. Nvidia is a company that absolutely still wants to stay in the Chinese market. They're currently very successfully walking this tightrope of convincing the US administration that they can manage and mitigate national security concerns, while driving profits and revenues that are good for US consumers and for US business. And at the same time, obviously for Nvidia, share price as well.
