China Warns Washington Against New Chip Curbs as Nvidia Scandal Fuels a Push in Congress

"China has consistently opposed the abuse of export control measures," foreign ministry spokeswoman Mao Ning said at her regular briefing. She was answering a question about calls from US lawmakers for tighter limits on exports of chipmaking equipment to China. She said the two countries should work together to implement "the important consensus" reached by their leaders and keep trade relations stable.

Her comments came a day after Jensen Huang resigned as chief executive of Nvidia. Huang has acknowledged an affair with Alice Huang, a former senior executive at Singapore data centre company Megaspeed, who is not related to him. A US intelligence memo circulated this spring reportedly alleged that she was an asset of China's Ministry of State Security. Beijing denies this and calls the allegation a pretext for a technological blockade meant to slow China's progress in AI.

The dispute matters for chip suppliers and their customers because it has moved the debate in Washington from Nvidia's governance to export policy itself. House Speaker Mike Johnson said this week that he was "in favour of limiting those exports" and pointed to a developing consensus in Congress. Neither Euronews nor TRT World, which reported the remarks, named specific bills.

The pressure has grown with reports about how restricted Nvidia hardware reached China. Bloomberg News reported on Friday, citing documents submitted to the Chinese government, that Shanghai Longteng Intelligent Computing, a company Alice Huang founded, ended up with servers containing Nvidia H800 chips. Washington banned exports of the H800 to China in 2023. It is not clear how the company acquired the servers or whether Alice Huang was involved.

Reports have also suggested that the Commerce Department under Howard Lutnick failed to act on suspicions that Megaspeed was helping divert restricted Nvidia technology to China. Megaspeed is investigating whether it complied with export controls. Malaysia is examining one of its subsidiaries over the possible diversion of advanced AI chips. The Senate Banking Committee has asked both Huang and Lutnick to testify.

The dispute comes just before a meeting between President Donald Trump and Chinese President Xi Jinping, expected next week at the Asia-Pacific Economic Cooperation gathering in Shenzhen. Mao's call to implement the leaders' earlier consensus suggests Beijing wants chip controls on the agenda there, while support for new limits grows in Congress.