Is the Nvidia scandal just a convenient way for the next round of AI chip export controls?
China's leadership calls on Washington not to use the scandal surrounding the head of Nvidia, Jensen Huang, and suspicions of Chinese espionage as an excuse to tighten restrictions on American technology exports to China. In a speech on November 12, Chinese Foreign Ministry spokesman Mao Ning said the US should stop pushing the "Chinese espionage narrative" as a cover for technology restrictions. China's scientific and technological progress, she said, rests on its own innovation and open international cooperation. Beijing also emphasized that it is in contact with the American side ahead of the upcoming meeting between the leaders of the two countries.
The scandal erupted after reports that a woman with whom Huang had a romantic relationship may be cooperating with Chinese intelligence. Huang himself admitted to an extramarital affair, but there was no published testimony that he knew about the woman's possible intelligence work or passed classified information to her. China dismisses the spying allegations as baseless, and Nvidia has launched an internal investigation, saying it has no reason to believe US national security or the company's company secrets were compromised.
The real geopolitical significance of the scandal is that it could give hardliners in Washington more ammunition to expand export controls on advanced semiconductors and artificial intelligence technology. Beijing fears that the investigation will become a pretext for restricting not only the direct supply of Nvidia chips but also remote access by Chinese companies to computing power abroad. Already, Chinese technology companies are trying to block access to foreign data centers equipped with Nvidia hardware ahead of time. Each affair complicates the preparations for the meeting between Donald Trump and Xi Jinping - and adds new risks to the fragile trade truce between the two countries.
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