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Top Senate Democrats have written an open letter to President Donald Trump, cautioning about resuming exports of advanced artificial intelligence (AI) chips to China. Trump permitted the exports on the condition that companies like Nvidia and Advanced Micro Devices would share 15% of their China revenues with the US government.
Six Senate Democrats, including Mark R. Warner (D-VA), Vice Chairman of the Senate Select Committee on Intelligence, and Chuck Schumer (D-NY), Senate Minority Leader, said in their letter that allowing the exports of advanced AI chips to China “run counter to U.S. national security interests.” They also warn that the 15% levy imposed on companies that export these chips might violate statutes and even the Constitution.
Senate Democrats Caution Against Allowing AI Chip Exports to China
“Our national security and military readiness relies upon American innovators inventing and producing the best technology in the world, and in maintaining that qualitative advantage in sensitive domains. The United States has historically been successful in maintaining and building that advantage because of, in part, our ability to deny adversaries access to those technologies,” the Senators said in their letter.
Notably, the Joe Biden administration had clamped down on exports of high-end AI chips to China, fearing dual military use. The Trump administration only tightened the screws and barred Nvidia from exporting its H20 chip to the Communist country. The Jensen Huang-led company had specifically designed that AI chip for China.
The H20 was the most advanced AI chip that Nvidia was exporting to China, even as it was less powerful than the Blackwell chips that the company sells in the US and other countries.
On his part, Trump tried to downplay H20 exports to China being a national security issue. The President termed H20 as “obsolete” and an “old chip that China already has.” He added, “The Blackwell is super-duper advanced. I wouldn’t make a deal with that.”
Trump further said, “That’s (Blackwell) the latest and the greatest in the world. Nobody has it. They won’t have it for five years.”
Senators Allege Trump Is Giving Away Competitive Edge
Meanwhile, many have been critical of Trump for allowing exports of advanced AI chips to China in exchange for a revenue share for the US government, as the primary reason for blocking these exports was national security.
Deborah Elms, head of trade policy at the Hinrich Foundation, said, “You either have a national security problem or you don’t.” She added, “If you have a 15% payment, it doesn’t somehow eliminate the national security issue.”
Senate Democrats also echoed similar views and said, “The willingness displayed in this arrangement to ‘negotiate’ away America’s competitive edge that is key to our national security in exchange for what is, in effect, a commission on a sale of AI-enabling technology to our main global competitor, is cause for serious alarm.”
Republicans Are Also Critical of Allowing AI Chip Exports to China
To be sure, it’s not that only Democrats are critical of the move to allow advanced AI chip exports to China. Last month, John Moolenaar, who heads a House of Representatives panel on China, sent a letter to Commerce Secretary Howard Lutnick over the proposal to allow H20 exports to China. In his letter, Moolenaar said, “The H20, which is a cost-effective and powerful AI inference chip, far surpasses China’s indigenous capability and would therefore provide a substantial increase to China’s AI development.”
AI War Between the US and China
There is an apparent AI war between the US and China. While the former blocked companies from exporting top-end AI chips to China, citing possible military use, many, including Nvidia CEO Jensen Huang, believe that the policy hasn’t succeeded.
Nvidia has been losing its market share, and the company has warned that it is losing its competitive edge in the country where it once had a dominant market share.
“Losing access to the China AI accelerator market, which we believe will grow to nearly $50 billion, would have a material adverse impact on our business going forward and benefit our foreign competitors in China and worldwide,” said Nvidia in its fiscal Q1 2026 earnings call in May.
Huang added, “China’s AI moves on with or without U.S. chips. It has the compute to train and deploy advanced models. The question is not whether China will have AI; it already does. The question is whether one of the world’s largest AI markets will run on American platforms. Shielding Chinese chip makers from U.S. competition only strengthens them abroad and weakens America’s position. Export restrictions have spurred China’s innovation and scale.”
China Cautions Domestic Companies Against H20 Chips
Meanwhile, China has been cautioning its domestic companies against using the H20 chips. Chinese authorities and state media have raised concerns about the security of US-made chips. They have alleged that chips like the H20 could have “backdoors” that allow for remote shutdown or data exfiltration. While Nvidia has vehemently denied these claims, Beijing is using these concerns to justify its push for domestic hardware, which it can more easily control and inspect.
The constant back-and-forth of US export controls has made US technology an unreliable and unpredictable commodity for Chinese companies. From the initial ban on advanced AI chips to the recent, conditional approval for H20 sales, the fluctuating policy landscape has given Beijing a strong incentive to build a more resilient and self-sufficient supply chain. This move aims to protect Chinese companies from future disruptions caused by geopolitical conflicts.
China Is Backing Its Domestic AI Companies
The move is also intended to support the domestic chip industry. Notably, China, which previously cracked down on its tech companies, especially Alibaba, is now backing its tech companies amid the AI war with the US. In February, Chinese President Xi Jinping met the country’s entrepreneurs, including Alibaba’s co-founder Jack Ma, at a symposium. Ma’s participation in the event with Jinping became all the more important as the Chinese billionaire was the face of China’s crackdown on its tech moguls, whom the Communist Party believed had grown too powerful.
