Nvidia CEO Jensen Huang has expressed optimism about obtaining US export licenses soon to ship its H20 AI chips to China.

Speaking at the International Supply Chain Expo in Beijing on July 16, 2025, Huang said that US officials assured the company of a prompt licensing process.

The H20 chip, designed for AI development, was created to comply with US export restrictions.

However, earlier controls had blocked sales without specific permits.

Nvidia announced earlier this week that US authorities had lifted these restrictions, allowing the company to resume exports of the chip to China.

Huang confirmed that Nvidia has significant orders ready for fulfillment.

It remains uncertain how many licenses will be approved and whether they will apply to new production or existing inventory. Huang noted, “We have to wait until the licenses come through,” reiterating confidence in the process.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ The economic stakes of AI chip access demonstrate why export controls have limited effectiveness

The H20 policy reversal reflects a pattern we’ve seen before: export controls on advanced technology often struggle to achieve their intended effects when economic incentives are overwhelming.

Before the reversal, Nvidia had reported billions in losses from unsold inventory and halted sales to China, while simultaneously seeing its market dominance erode from 95% to 50% according to Jensen Huang’s May statements 1.

China’s data center buildout continues, with Bloomberg reporting 39 planned centers in Xinjiang expected to utilize over 115,000 advanced AI chips 1.

These economic realities create powerful pressure against restrictions. Companies lose revenue while target countries develop alternatives, as evidenced by Huawei’s growing market share during the restriction period.

Export controls face a fundamental dilemma: too permissive and they fail to limit access to sensitive technology, too restrictive and they accelerate domestic development and create economic blowback on domestic industries.

2️⃣ AI chip competition intensifies beyond the geopolitical headlines