The approvals allow Chinese tech giants ByteDance, Alibaba and Tencent to purchase over 400,000 H200 chips collectively, with additional firms reportedly lining up for subsequent rounds of authorization, the sources said.
The decision reportedly came during Nvidia CEO Jensen Huang’s visit to China this week, underscoring the growing strategic importance of advanced AI chips amid escalating global competition.
A Long-Standing Bottleneck Eases
The Nvidia H200—one of the world’s most powerful AI chips—has been a major point of contention in U.S.-China tech relations. While the U.S. has granted export approval, China’s previous reluctance to allow imports had been the primary obstacle to shipments.
The U.S. formally cleared the way for H200 exports to China earlier this month, but Chinese authorities retained the final decision, creating uncertainty around whether shipments would be allowed. Recent weeks saw mixed signals, with Chinese customs reportedly telling agents that the H200 chips were not permitted to enter the country.
Demand Far Outstrips Supply
Despite the regulatory uncertainty, Chinese firms have placed orders for more than two million H200 chips, according to Reuters—vastly exceeding Nvidia’s available inventory.
This strong demand has forced Beijing into a delicate balancing act: meeting the needs of domestic AI development while protecting and promoting local chip manufacturers.
Strategic Implications
The approvals indicate Beijing may be prioritizing the needs of major internet companies that are investing heavily in AI infrastructure. These firms are racing to build data centres and AI services to rival U.S. competitors, including OpenAI.
While Chinese companies such as Huawei have developed advanced AI chips comparable to Nvidia’s earlier H20 model, they still lag behind the H200, which delivers about six times the performance of the H20.
Domestic Chip Conditions May Follow
Beijing has reportedly discussed imposing conditions on foreign chip imports—such as requiring firms to purchase a certain quota of domestic chips before receiving approval. It remains unclear how many more companies will receive H200 approvals or what criteria the government will use in subsequent rounds.
As the global AI race intensifies, China’s latest move suggests a cautious but pragmatic shift toward accommodating immediate AI computing needs while continuing to nurture its domestic semiconductor industry.