The limits of Washington’s efforts to restrain Beijing’s high-tech ambitions were exposed when at least $1bn worth of Nvidia’s advanced artificial intelligence processors were shipped to China in the three months following Donald Trump’s tightening of chip export controls. A Financial Times analysis found that Nvidia’s B200 chip, banned for sale to China, became highly sought-after in the Chinese black market for American semiconductors. Despite the restrictions, Chinese distributors managed to sell these chips to data centers serving Chinese AI groups. Nvidia recently announced that the Trump administration would allow the sale of its China-specific H20 chip once again.
One of the largest sellers of B200 chips, a company called Gate of the Era, was founded in anticipation of the restrictions on H20 chip sales. They sold these chips in ready-built racks to various companies in China, making an estimated $400mn in sales. Gate of the Era lists an AI solution provider, China Century, as its largest shareholder, claiming to build “the new century of a smart China.” China Century’s website mentions partnerships with AliCloud, ByteDance’s Huoshan Cloud, and Baidu Cloud, although these companies did not respond to requests for comment regarding their involvement with Nvidia chips.
Despite the restrictions, industry insiders revealed that many of the B200 racks sold in China were originally from Supermicro, a US-based assembler that provides chip solutions to data centers. Supermicro stated that they comply with all US export control requirements. Chinese data center operators believe that export controls will not prevent the most advanced Nvidia products from entering China. The result is simply inefficiency and substantial profits for the daring middlemen involved.
The Thai government has not responded to a request for comment.
In recent news, Malaysia has implemented stricter export controls targeting advanced AI chip shipments from the country, particularly to China.
There is a growing concern about potential tightening of export controls in south-east Asian countries, leading to a rush among buyers to place orders before any new rules are enforced, as per sources familiar with the situation.
Even if traditional avenues for obtaining AI chips are restricted, Chinese industry insiders are confident that new shipping routes will be established. Some supplies have already started coming in through European countries that are not on the restricted list.
“History has shown time and time again that where there is a significant profit to be made, solutions will always be found,” noted a Chinese distributor.
Visuals by James Sandy, Rory Griffiths and Alex Wheeler in London.
Additional reporting by Michael Acton in San Francisco, Demetri Sevastopulo in Washington, and Anantha Lakshmi in Jakarta.
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