Nvidia and Advanced Micro Devices (AMD) have reached an agreement with the US government to pay 15% of their Chinese AI chip sales revenue to secure export licenses. This unique arrangement is set to have significant implications for both US companies and Beijing.
Nvidia intends to allocate 15% of the earnings from the sales of its H20 AI accelerator in China, while AMD will follow suit with 15% from MI308 revenues. This move is part of President Donald Trump’s strategy to negotiate financial benefits for the US in exchange for trade concessions. However, this specific export tax arrangement is unprecedented and could impact future trade negotiations.
Beijing has expressed concerns about the H20 chips and is unlikely to welcome the idea of a chip tax. The Chinese government views these chips as potential security risks and inefficient compared to local alternatives. This development could strain US-China relations further.
The revenue-sharing agreement raises questions about the US’s stance on national security and trade negotiations with allies. The potential implications of this deal could impact the US semiconductor industry and its relationships with foreign governments.
