In a stunning reversal of American foreign policy, President Donald Trump has authorized tech giant Nvidia to resume sales of its most advanced artificial intelligence chips to China.

This decision dismantles the strict containment strategy of the previous administration, signaling a new era where economic gain—specifically a 25% government cut of the proceeds—supersedes previous national security anxieties about Beijing’s military capabilities. For the global tech market, and observers here in Nairobi, the move represents a dramatic shift from trade war to trade deal.

The Art of the AI Deal

The announcement came via Trump’s Truth Social platform on Monday, where he confirmed that he had personally informed Chinese President Xi Jinping of the policy shift. The deal allows Nvidia to ship its H200 products—currently among the most powerful processors in the world—to "approved customers" in China.

"President Xi responded positively!" Trump noted, adding that the arrangement includes conditions to maintain "strong National Security."

However, the terms of the deal have raised eyebrows among trade economists and constitutional scholars alike. The President revealed that the US federal government would receive 25% of the proceeds from these sales. This figure is a significant jump from a previously mooted 15% cut and follows a pattern of unorthodox state interventions, including a proposal in August for the US to take a 10% equity stake in chipmaker Intel.

From Ban to Boom

To understand the magnitude of this shift, one must look at the hardware involved. The H200 is not merely a computer part; it is the engine behind the world's most advanced generative AI systems. Under the Biden administration, these chips were strictly embargoed to prevent China from accelerating its military and surveillance capabilities.

The pivot affects major players in the semiconductor space:

• Nvidia: CEO Jensen Huang has spent months lobbying for this access, arguing that US companies were losing ground to Chinese domestic alternatives.
• AMD & Intel: Trump indicated that similar offers are being finalized for these competitors, potentially opening the floodgates for American tech exports.
• The H20 vs. H200: Previously, Nvidia designed a watered-down chip (the H20) for China to comply with sanctions. This new directive clears the way for the flagship H200, rendering those workarounds obsolete.

Security Concerns and Global Ripples

While Wall Street may cheer the reopening of the massive Chinese market, the geopolitical implications are complex. Critics argue that selling the H200 to Beijing effectively powers the very rival the US has been trying to contain.

Democratic Senators Elizabeth Warren and Andy Kim have already sounded the alarm. In a letter to Commerce Secretary Howard Lutnick last week, cited by The Hill, they warned that these exports risk fueling China’s "surveillance, censorship and military applications."

For Kenya, a nation increasingly digitizing its economy and relying on global tech supply chains, this détente could have mixed results. A normalized trade environment between the US and China often stabilizes global electronics prices. However, the proliferation of high-end AI tools raises questions about the accessibility of such power for developing nations if the focus shifts entirely to the lucrative Sino-American trade corridor.

As the Department of Commerce finalizes the details, the world is watching to see if this profit-sharing model becomes the new standard for American diplomacy.