Xi Jinping has just decreed the final technological divorce with the United States

Nvidia engineers have almost ended the development of a GPU with Blackwell microarchitecture with a single purpose: power replace chip h20 They cannot sell in China. The US Department of Commerce vetoed such exports, so the firm led by Jensen Huang He looked for an exit with a chip adapted to government demands. TSMC is expected to start making this GPU this month, but That effort may even help. Not that Nvidia is fighting with the Absolute distrust of US legislators: China is turning its back.

As indicated In SCMPthat chip for the Chinese market is not ready. In the conference for investors that Jensen Huang gave last week he indicated that “the key is to understand the limits and know if we can develop interesting products that can remain useful for the Chinese market. We have nothing to announce at the moment, but we are considering it.”

Xi Jinping wants to eliminate the US software and hardware dependence, and is on its way to get it

Huang made a surprise trip to China when the veto was announced to those exports in mid -April, and met with several senior Chinese officials to express their commitment to this market. The new chip that theoretically prepares for China will be significantly cheaper than H20but those statements of the CEO of Nvidia already made it clear that it would not be based on said microarchitecture.

For Nvidia that effort is logical: during the last fiscal year that ended on January 26, 2025, China represented about 13% of its global income: about 17,000 million dollars. It is the third best client of the company, only behind the US and Taiwan, but the sanctions that the United States government is deploying were one of the great threats to Nvidia’s survival in the Asian giant. The other is even more worrying.

Meanwhile, China continues to work tirelessly to completely eliminate its traditional United States dependence in this segment. Companies that are designing GPUS for games and artificial intelligence (AI), and the Chinese government is subsidizing them remarkably after US sanctions. Companies like HuaweiMetax, Biren Technology, Moore ThreadsInnosilicon, Zhaoxin, Iluvatar Orex, Deglinai, Lisuan Technology Or Vastai Tech work in that field.

In fact, the problem for Huang and Nivdia is that Xi Jinping made clear in a session With the Chinese politician that China’s objective is to “deduct” the country’s technologies set. All the development of China, both software and hardware, must end up depending on solutions developed in the country. Thus, no matter the efforts that Nvidia can do to create chips adapted to the Chinese market: the president of China wants to depend only on Chinese technology To boost the development of your AI, and that means a worrying news for Nvidia.

Image | Hillel Steinberg | Global panorama

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