In a surprising twist, China is wary of using Nvidia chips.

"If a particular type of integrated circuit is neither environmentally friendly, advanced, nor safe, we as consumers certainly have the option not to buy it ," the article, published on WeChat and quoted by Reuters, concluded.

In July, Trump lifted the ban on the sale of H20 chips to China.

The H20 AI chips were developed by Nvidia for the Chinese market after the United States imposed export restrictions on advanced AI chips in late 2023. U.S. President Donald Trump's administration banned their sale in April amid escalating trade tensions with China, but reversed the ban in July.

China's cybersecurity watchdog said on July 31 that it had summoned Nvidia representatives to a meeting, asking the U.S. chipmaker to clarify whether its H20 chips contain any backdoor security threats – a hidden method for bypassing standard authentication or security checks.

Nvidia later stated that its products do not have "backdoors" that would allow remote access or control.

Yuyuan Tantian's comments followed criticism of Nvidia from the People's Daily, another Chinese state-run media outlet. In a commentary published earlier this month, the People's Daily said Nvidia must provide "convincing security evidence" to allay Chinese users' concerns about the security risks of its chips and regain market trust.

Chipmakers to pay US government to export to China

Nvidia and AMD will pay the federal government 15% of revenue from exports of chips used to build AI systems to China, the Financial Times and other media reported on Sunday. The New York Times called the arrangement "highly unorthodox ."

As reported by the British newspaper, two companies have agreed to pay the state 15% of revenue from chip sales to China in exchange for export licenses. These are two types of chips: Nvidia's H20 and MI308. These are advanced chips used to build AI systems, but they are not among the most advanced products from these companies.

The deal marks a shift in policy by the Trump administration, which initially banned H20 exports to China , citing national security concerns. After negotiations with China, the administration announced it would allow exports of the chips, but has not yet issued any export licenses.

The breakthrough allegedly occurred after a Wednesday meeting between President Donald Trump and Nvidia CEO Jensen Huang. Huang reportedly told Trump that export controls only handed the Chinese market over to Chinese companies. Trump agreed to issue licenses, but only if the companies paid the government 15% of their export revenues.

According to the New York Times, the deal could bring the budget around $2 billion.