Commerce Secretary Howard Lutnick said the United States is not sending its “best chips” to China, in line with the Trump administration’s export restrictions on advanced artificial intelligence chips.
“I want to be crystal clear: We are not selling our best chips to China under any circumstance,” he told the Senate Appropriations Committee on Wednesday while testifying about the president’s fiscal year 2027 budget request.
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Lutnick assured the congressional panel that the U.S. is not selling Nvidia’s Blackwell chips and that the Chinese government or state-affiliated companies are not buying any chips from that brand.
Sen. Jeanne Shaheen (D-NH) pressed the commerce secretary, saying she had unspecified intelligence that said the U.S. was exporting top-quality chips to China. Lutnick responded, telling the senator, “They have not bought any as of today.”
In January, the Trump administration approved the export of Nvidia’s H200 chips to China on certain conditions. The move alarmed China hawks in Congress because Beijing could theoretically use the technology to improve its military.
Later in the hearing, Lutnick said he believes U.S.-based Nvidia has not sold any H200 chips to Chinese state-affiliated companies that may pass on the technology to the Chinese military.
“My understanding is their cloud companies want to buy these chips,” Lutnick told Sen. Chris Coons (D-DE). “The Chinese central government has not let them, as of yet, buy the chips because they’re trying to keep their investment focused on their own domestic industry.”
The Cabinet official noted Nvidia’s H200 chips are not as advanced as those in the Blackwell brand.
“We’re not giving them the absolute best, the most cutting edge, but we’re giving them incredibly powerful chips that they don’t otherwise have access to,” Coons said in summarizing the commerce secretary’s response without specifying which chips.
Lutnick followed up that response by clarifying it’s his “understanding” that China has been unable to obtain H200 chips from the U.S.
Lutnick described the U.S.-China relationship as a “delicate balance,” one that President Donald Trump is committed to maintaining with Chinese President Xi Jinping amid ongoing trade negotiations.
In early November, the so-called affiliates rule was delayed for one year as part of a trade truce with China. The regulation would have restricted U.S. shipments of advanced AI chips to Chinese companies.
During his congressional hearing, Lutnick indicated the administration was open to reinstating the affiliates rule depending on how the trade talks develop.
“I agree that the affiliates rule is a smart thing for the United States of America to consider, but it is part of the balance of that full trade agreement,” he answered following a question from Sen. Chris Van Hollen (D-MD).
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Lutnick said Treasury Secretary Scott Bessent and U.S. Trade Representative Ambassador Jamieson Greer are part of the Trump-led trade team with China, adding he focuses “on the rest of the world.”
Trump is set to meet Xi in Beijing next month to further the trade negotiations and discuss other issues, including the U.S.-Iran war. The state visit, scheduled for May 14 and 15, will mark Trump’s return to China since his first term. Trump last met Xi in South Korea in late October.
