Japan's LDP Suffers Bruising Loss in Tokyo Before National Vote
The LDP lost 9 seats in the 127-seat assembly to end up with 21 representatives after Sunday's election, leaving it well behind Tokyo Governor Yuriko Koike's Tomin First no Kai, a locally focused party that maintained its grip on 31 seats. Among national opposition parties, the Constitutional Democratic Party expanded its representation on the assembly to 17 from 12, while the Democratic Party for the People won its first nine seats in the metropolitan government.
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CNN
an hour ago
- CNN
Nvidia and AMD will give US 15% of China sales. But Chinese state media warns about their chips
Asia China Tech giants Donald TrumpFacebookTweetLink Follow Nvidia and AMD have agreed to pay the US government 15% of their revenues from semiconductor sales to China in exchange for export licenses, an unprecedented quid pro quo arrangement aimed at solidifying America's AI business dominance while maintaining trade ties with China. The deal with the Trump administration allows the companies to obtain export licenses to sell Nvidia's H20 chips and AMD's MI308 chips in China, a US official told CNN. The Financial Times first reported the story Sunday. The deal came together after Nvidia CEO Jensen Huang met with President Donald Trump on Wednesday, the official said. Although the export licenses were granted Friday, no shipments have yet been made. It's still unclear how the deal will be structured, but the White House may use its recent trade agreements as a template. 'We follow rules the US government sets for our participation in worldwide markets,' a Nvidia spokesperson said in a statement. 'While we haven't shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide.' Trump said Monday that the AI chips he approved for sale to China are 'obsolete,' but he left open the possibility that Nvidia could export its super high-end Blackwell chips for a higher price. 'The chip that we're talking about, the H20, it's an old chip,' Trump said at a press conference Monday. 'China already has it in a different form, different name, but they have it.' Trump said Huang, who met with the president Wednesday, wanted to sell the H20 AI chip to China after the Trump administration expressed openness to lifting its export ban on the technology. But Trump demanded payment to the US government in exchange for the export license. At first, Trump said he wanted Nvidia to pay the US government 20% of sales of its AI chips exported to China, but they negotiated a rate of 15%. 'I said, if I'm going to do that, I want you to pay us, as a country, something, because I'm giving you a release,' Trump said. The H20 is a sophisticated AI processor, although it is not Nvidia's highest-end processor. The Blackwell chip is significantly more advanced, and the Trump administration has closed the door on the export of that technology to China — even after reversing course on the H20. However, Trump on Monday said that he'd consider allowing Nvidia to sell the Blackwell chip if Nvidia pays the US government an even steeper cost. 'The Blackwell is superduper advanced. I wouldn't make a deal with that, although it's possible,' Trump said. 'I'd make a deal – a somewhat enhanced in a negative way. Blackwell, in other words, take 30% to 50% off of it, but that's the latest and the greatest in the world. Nobody has it. They won't have it for five years.' Trump said Huang will return to the White House in the future to discuss selling an 'unenhanced' version of Blackwell. 'I think he's coming to see me again about that, but that will be a unenhanced version of the big one,' Trump said. 'You know, we will sometimes sell fighter jets to a country and we'll give them 20% less than we have.' The AI chips are in extremely high demand and the arrangement could raise billions of dollars for the US government. But it's unclear how successful the venture will be, because China may not be willing to play ball: Nvidia's H20 chips pose security concerns for China, a social media account linked to Chinese state media said Sunday, as Washington and Beijing near a deadline to strike a deal in trade negotiations in which technology has also emerged as a key issue. China could choose not to buy US tech firm Nvidia's H20 chips, said the account, Yuyuan Tantian, which is affiliated with state broadcaster CCTV, as it claimed that the artificial intelligence (AI) chips could have 'backdoors' that impact their function and security. 'When a type of chip is neither environmentally friendly, nor advanced, nor safe, as consumers, we certainly have the option not to buy it,' said the commentary, which came after China's cybersecurity administration also raised concerns over backdoor access in those chips. Nvidia has repeatedly denied that its products have backdoors. China's access to American technology, especially high-end chips that can be used in the development of artificial intelligence, has become a key issue in trade and tech frictions between the rival economies – as both vie for tech dominance. A trade truce between the two countries that reduced triple-digit tariffs is set to expire on August 12, though officials have signaled an extension could come into effect following talks in Sweden last month. Nvidia last month said it would resume sales of the H20 chip to China after the White House changed course on export controls it imposed in April as its trade frictions with China deepened. US Treasury Secretary Scott Bessent told Bloomberg in an interview at the time that the Nvidia export controls have been a 'negotiating chip' in the larger US-China trade talks. Nvidia released the H20 chip last year to maintain access to the Chinese market following strict export controls put in place under the Biden administration that stopped the export of chips with greater processing power. Nvidia's announcement last month that it would be able to export the H20 chip to China raised concerns among some US lawmakers, who support tight controls to prevent China from using American technology to advance its military and AI systems. Trump administration have correctly said that the H20 chips aren't the top-of-the-line AI chips that can build large language models. As a result, the White House has been willing to open up the market for those chips to maintain US business dominance in AI – without giving up the cream-of-the-crop chips to China, which administration officials say could still pose a national security threat. China's mounting concern about the security of the chips comes after the White House last month recommended implementing export controls that would verify the location of advanced artificial intelligence chips. China's cyberspace regulator late last month summoned Nvidia over security concerns about 'tracking and positioning' and 'remote shutdown' capabilities. In a blog post published last week, Nvidia reiterated that its chips did not have back doors, spyware or kill switches and said that 'embedding backdoors and kill switches into chips would be a gift to hackers and hostile actors.' China's security concerns appear to mirror those that the US has in the past expressed about Chinese technology, most prominently the first Trump administration's campaign against the growing foothold of Chinese tech giant Huawei in global communications infrastructure. Chinese leaders have also pushed for the country's tech firms to become self-sufficient and reduce reliance on American-made chips to achieve Beijing's AI and tech ambitions, and experts have said that controls on chips like the H20 could push China to speed up its own innovation. But the H20 is not the only technology that reports suggest is entangled with negotiations between the two sides. According to another report from the FT also published Sunday, China wants the US to ease export controls on a critical component for artificial intelligence chips as part of a trade deal ahead of a possible summit between President Donald Trump and Chinese leader Xi Jinping. Chinese officials have told experts in Washington that Beijing wants the Trump administration to relax export restrictions on high-bandwidth memory (HBM) chips, the FT reported, citing several people familiar with the matter. The US government imposed export controls on the sale of such memory chips to China last year. CNN's Nectar Gan contributed to this report.
CNN
an hour ago
- CNN
The world's biggest company got caught in the middle of Trump's AI war with China
Nvidia, the world's most valuable company, has found itself caught in the middle of President Donald Trump's historic trade war with China. The result: an extraordinary concession from a $4.5 trillion corporation that will give the United States a percentage of every high-end AI chip sold in China. The deal, which AMD also signed for some of its chips, could split the difference between two competing Trump administration goals: maintain America's AI dominance while securing a critical trade agreement with China. It could also give the White House billions of dollars to spend as it wishes. Nvidia and AMD have agreed to pay the US government 15% of their revenues from semiconductor sales to China in exchange for licenses to export their technology there. The White House in April blocked the export of certain AI chips to China, including Nvidia's H20 chips and AMD's MI308 chips. The deal with the Trump administration allows the companies to obtain export licenses to restart sales of those chips in China, a US official told CNN. The Financial Times first reported the story Sunday. Nvidia previewed the deal last month, when it said it would resume sales of the H20 chip to China after the Trump administration expressed openness to allowing the export of certain AI chips again. But the 15% payment was a surprise. Trump said Nvidia was initially asked to pay a 20% cut, but they negotiated the rate down to 15%. The deal came together after Nvidia CEO Jensen Huang met with President Donald Trump on Wednesday, the official said. Although the export licenses were granted Friday, no shipments have yet been made. 'We follow rules the US government sets for our participation in worldwide markets,' a Nvidia spokesperson said in a statement. 'While we haven't shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide.' AMD has not responded to CNN's request for comment. Governments, including the United States, have taken control of companies in the past when they were considered to be of strategic importance to national security. During the financial crisis in 2009, the United States took control of General Motors and Chrysler, and the proceeds of those stakes went directly into the US Treasury after the government sold them for a profit. But it's not clear that the US government has ever demanded a percentage of a company's business without taking an equity stake – or if it's even legal to do so. The US Constitution forbids taxes on exports. To get around that, the deal's terms have been structured as a voluntary agreement, so it won't be considered a tax or a tariff, a US official said. Instead, Nvidia and AMD will voluntarily send funds to the US government. The companies will have no say whatsoever on how the US government deploys that money after it is sent. 'It's hard to identify any historical precedent for this sort of arrangement,' said Sarah Kreps, law professor and director of the Tech Policy Institute at Cornell University's Brooks School of Public Policy. In recent years, the US government has sought to restrict China's access to advanced American technology in an effort to slow its progress on AI and let the United States get farther ahead. But the White House's reversal on export controls may be an acknowledgement that China is advancing in AI regardless, so American companies might as well be allowed to benefit. It could also give the White House another way to raise revenue for the US government, along with tariffs. 'It seems like there's been some vacillation within the administration about and toward China, and I think that reflects the internal divide within the administration between the China hawks and the economic pragmatists,' Kreps said. 'It seems like increasingly, the economic pragmatists are holding sway.' That approach would align with arguments from Nvidia's Huang, who has said that restricting sales of American AI chips is bad for US national security. Chinese developers could simply undermine US leadership by creating their own alternatives if they can't buy American technology, according to Huang, who has met with Trump repeatedly in recent months. The White House agrees with Huang, believing it's better to have China locked into a US-made chip sold through legitimate channels than to force China to the black market, a US official said. China has been able to subvert existing channels to obtain restricted chips anyway. Big questions remain about where the 15% commission idea emerged and what it could mean for national security. A US official said that the payment allows the administration to maintain control of the export process and bring in revenue for the US government in the process. Still, it's not clear that the penalty for Nvidia and AMD will effectively limit the flow of the chips or erase any potential national security issues. 'If there's a legitimate national security concern about exporting these chips to China, then I don't see how the payments to the US government address those risks. In fact, they don't at all,' said Scott Kennedy, senior adviser and trustee chair in Chinese business and economics at the Center for Strategic and International Studies. 'And if there's not a sufficient national security risk or they can be adequately mitigated … then the US government should just get out of the way and expect nothing in return.' Nvidia released the H20 chip last year as a way to maintain access to the Chinese market — which made up 13% of the company's sales in 2024 — in the face of US export controls imposed by the Biden administration. But the chips are widely believed to have contributed to DeepSeek, an advanced Chinese AI model that shook Silicon Valley upon its release earlier this year, raising concerns that China was further ahead on AI than previously understood. After the Trump administration barred H20 sales to China in April, Nvidia said it took billions of dollars in charges and lost revenue because of the export controls in the first quarter and projected a similar outcome in the second quarter. So, even if it has to fork over 15% of those sales to the White House, resuming shipments of the H20 to China could mean billions more dollars in revenue for Nvidia — which became the first publicly traded company to top $4 trillion in valuation last month. Shares of Nvidia (NVDA) rose as much as 0.5% on Monday. Trump on Monday called Nvidia's H20 chip 'obsolete,' saying that China 'already has it in a different form.' But some experts disagree with Trump's characterization of the chips. 'These H20s are still state of the art,' CSIS's Kennedy said. Although they're less advanced, in some ways, than other Nvidia chips, 'they also come with elements that make them extremely sophisticated and valuable,' including their memory capabilities. 'I think suggestions that they are obsolete understate the value to user,' he said. Nvidia likely reasoned that there is enough Chinese demand for the chips to make the 15% commission to the White House a worthwhile trade-off for its business, according to Kreps. 'You have to do a calculation based on what was lost from the export controls,' she said. Trump on Monday left open the possibility that Nvidia could export its super high-end Blackwell chips for a higher price. The Trump administration had closed the door on the export of that technology to China — even after reversing course on the H20. However, Trump on Monday said that he'd consider allowing Nvidia to sell the Blackwell chip. 'The Blackwell is superduper advanced. I wouldn't make a deal with that, although it's possible,' Trump said. 'I'd make a deal a somewhat enhanced in a negative way. Blackwell, in other words, take 30% to 50% off of it, but that's the latest and the greatest in the world. Nobody has it. They won't have it for five years.' Trump said Huang will return to the White House in the future to discuss selling an 'unenhanced' version of Blackwell. 'I think he's coming to see me again about that, but that will be a unenhanced version of the big one,' Trump said. 'You know, we will sometimes sell fighter jets to a country and we'll give them 20% less than we have.' Questions from Beijing about the security of American AI chips also raise uncertainty about just how successful Trump's commission policy could be. China could choose not to buy US tech firm Nvidia's H20 chips, the social media account Yuyuan Tantian, which is affiliated with state broadcaster CCTV, said on Sunday. It claimed that the chips could have 'backdoors' that impact their function and security, following previous similar claims from China's cybersecurity administration. Nvidia has repeatedly denied that its products have backdoors. However, that statement could be less an indication that China won't buy American chips and more a signal to Chinese tech companies to continue innovating in semiconductors even if US shipments do resume, Kennedy said. For the Trump administration, the cost-benefit analysis is that it opens up the flow of mid-tier chips to China while giving the administration a key bargaining chip in its ongoing trade talks, a US official said. Treasury Secretary Scott Bessent has called Nvidia export controls a 'negotiating chip' in the larger US-China trade talks. But China knows that, and its posturing over supposed security concerns with the H20 chip this weekend suggests that it won't be won over so easily — even if it wants the chips for its market.
CNN
an hour ago
- CNN
The world's biggest company got caught in the middle of Trump's AI war with China
Tech giants Asia China Donald TrumpFacebookTweetLink Follow Nvidia, the world's most valuable company, has found itself caught in the middle of President Donald Trump's historic trade war with China. The result: an extraordinary concession from a $4.5 trillion corporation that will give the United States a percentage of every high-end AI chip sold in China. The deal, which AMD also signed for some of its chips, could split the difference between two competing Trump administration goals: maintain America's AI dominance while securing a critical trade agreement with China. It could also give the White House billions of dollars to spend as it wishes. Nvidia and AMD have agreed to pay the US government 15% of their revenues from semiconductor sales to China in exchange for licenses to export their technology there. The White House in April blocked the export of certain AI chips to China, including Nvidia's H20 chips and AMD's MI308 chips. The deal with the Trump administration allows the companies to obtain export licenses to restart sales of those chips in China, a US official told CNN. The Financial Times first reported the story Sunday. Nvidia previewed the deal last month, when it said it would resume sales of the H20 chip to China after the Trump administration expressed openness to allowing the export of certain AI chips again. But the 15% payment was a surprise. Trump said Nvidia was initially asked to pay a 20% cut, but they negotiated the rate down to 15%. The deal came together after Nvidia CEO Jensen Huang met with President Donald Trump on Wednesday, the official said. Although the export licenses were granted Friday, no shipments have yet been made. 'We follow rules the US government sets for our participation in worldwide markets,' a Nvidia spokesperson said in a statement. 'While we haven't shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide.' AMD has not responded to CNN's request for comment. Governments, including the United States, have taken control of companies in the past when they were considered to be of strategic importance to national security. During the financial crisis in 2009, the United States took control of General Motors and Chrysler, and the proceeds of those stakes went directly into the US Treasury after the government sold them for a profit. But it's not clear that the US government has ever demanded a percentage of a company's business without taking an equity stake – or if it's even legal to do so. The US Constitution forbids taxes on exports. To get around that, the deal's terms have been structured as a voluntary agreement, so it won't be considered a tax or a tariff, a US official said. Instead, Nvidia and AMD will voluntarily send funds to the US government. The companies will have no say whatsoever on how the US government deploys that money after it is sent. 'It's hard to identify any historical precedent for this sort of arrangement,' said Sarah Kreps, law professor and director of the Tech Policy Institute at Cornell University's Brooks School of Public Policy. In recent years, the US government has sought to restrict China's access to advanced American technology in an effort to slow its progress on AI and let the United States get farther ahead. But the White House's reversal on export controls may be an acknowledgement that China is advancing in AI regardless, so American companies might as well be allowed to benefit. It could also give the White House another way to raise revenue for the US government, along with tariffs. 'It seems like there's been some vacillation within the administration about and toward China, and I think that reflects the internal divide within the administration between the China hawks and the economic pragmatists,' Kreps said. 'It seems like increasingly, the economic pragmatists are holding sway.' That approach would align with arguments from Nvidia's Huang, who has said that restricting sales of American AI chips is bad for US national security. Chinese developers could simply undermine US leadership by creating their own alternatives if they can't buy American technology, according to Huang, who has met with Trump repeatedly in recent months. The White House agrees with Huang, believing it's better to have China locked into a US-made chip sold through legitimate channels than to force China to the black market, a US official said. China has been able to subvert existing channels to obtain restricted chips anyway. Big questions remain about where the 15% commission idea emerged and what it could mean for national security. A US official said that the payment allows the administration to maintain control of the export process and bring in revenue for the US government in the process. Still, it's not clear that the penalty for Nvidia and AMD will effectively limit the flow of the chips or erase any potential national security issues. 'If there's a legitimate national security concern about exporting these chips to China, then I don't see how the payments to the US government address those risks. In fact, they don't at all,' said Scott Kennedy, senior adviser and trustee chair in Chinese business and economics at the Center for Strategic and International Studies. 'And if there's not a sufficient national security risk or they can be adequately mitigated … then the US government should just get out of the way and expect nothing in return.' Nvidia released the H20 chip last year as a way to maintain access to the Chinese market — which made up 13% of the company's sales in 2024 — in the face of US export controls imposed by the Biden administration. But the chips are widely believed to have contributed to DeepSeek, an advanced Chinese AI model that shook Silicon Valley upon its release earlier this year, raising concerns that China was further ahead on AI than previously understood. After the Trump administration barred H20 sales to China in April, Nvidia said it took billions of dollars in charges and lost revenue because of the export controls in the first quarter and projected a similar outcome in the second quarter. So, even if it has to fork over 15% of those sales to the White House, resuming shipments of the H20 to China could mean billions more dollars in revenue for Nvidia — which became the first publicly traded company to top $4 trillion in valuation last month. Shares of Nvidia (NVDA) rose as much as 0.5% on Monday. Trump on Monday called Nvidia's H20 chip 'obsolete,' saying that China 'already has it in a different form.' But some experts disagree with Trump's characterization of the chips. 'These H20s are still state of the art,' CSIS's Kennedy said. Although they're less advanced, in some ways, than other Nvidia chips, 'they also come with elements that make them extremely sophisticated and valuable,' including their memory capabilities. 'I think suggestions that they are obsolete understate the value to user,' he said. Nvidia likely reasoned that there is enough Chinese demand for the chips to make the 15% commission to the White House a worthwhile trade-off for its business, according to Kreps. 'You have to do a calculation based on what was lost from the export controls,' she said. Trump on Monday left open the possibility that Nvidia could export its super high-end Blackwell chips for a higher price. The Trump administration had closed the door on the export of that technology to China — even after reversing course on the H20. However, Trump on Monday said that he'd consider allowing Nvidia to sell the Blackwell chip. 'The Blackwell is superduper advanced. I wouldn't make a deal with that, although it's possible,' Trump said. 'I'd make a deal a somewhat enhanced in a negative way. Blackwell, in other words, take 30% to 50% off of it, but that's the latest and the greatest in the world. Nobody has it. They won't have it for five years.' Trump said Huang will return to the White House in the future to discuss selling an 'unenhanced' version of Blackwell. 'I think he's coming to see me again about that, but that will be a unenhanced version of the big one,' Trump said. 'You know, we will sometimes sell fighter jets to a country and we'll give them 20% less than we have.' Questions from Beijing about the security of American AI chips also raise uncertainty about just how successful Trump's commission policy could be. China could choose not to buy US tech firm Nvidia's H20 chips, the social media account Yuyuan Tantian, which is affiliated with state broadcaster CCTV, said on Sunday. It claimed that the chips could have 'backdoors' that impact their function and security, following previous similar claims from China's cybersecurity administration. Nvidia has repeatedly denied that its products have backdoors. However, that statement could be less an indication that China won't buy American chips and more a signal to Chinese tech companies to continue innovating in semiconductors even if US shipments do resume, Kennedy said. For the Trump administration, the cost-benefit analysis is that it opens up the flow of mid-tier chips to China while giving the administration a key bargaining chip in its ongoing trade talks, a US official said. Treasury Secretary Scott Bessent has called Nvidia export controls a 'negotiating chip' in the larger US-China trade talks. But China knows that, and its posturing over supposed security concerns with the H20 chip this weekend suggests that it won't be won over so easily — even if it wants the chips for its market.
