China initiated an antitrust investigation into Nvidia, the world’s leading producer of AI processors, as reported by Chinese state media. This development highlights the growing competition between China and the United States over artificial intelligence. A field both view as critical to their national security strategies.
Mellanox Acquisition Under the Microscope
The Chinese government raised concerns over Nvidia’s 2020 acquisition of Mellanox, an Israeli networking company. While the merger was approved by China at the time, officials now allege it may violate anti-monopoly regulations. Details on how the deal might contravene these laws remain unspecified.
Despite Nvidia’s success in the market, with its stock soaring nearly 200% this year due to the AI boom, the investigation has put the company under pressure. Nvidia’s valuation, exceeding $3 trillion, positions it as a linchpin in the global AI landscape. And a focal point in the intensifying tech standoff between the two nations.
US and China Trade Blows in the Chip War
The investigation comes as tensions between the US and China escalate over technology exports. Recent restrictions by the US on advanced memory chip sales to China aim to curb Beijing’s AI development, which American officials believe could provide military advantages.
China hit back by banning the export of key chip-making materials, including germanium and gallium. These moves follow the closure of previous loopholes that allowed limited exports of these essential resources.
Both nations are also heavily investing in their semiconductor industries. The US directed billions into domestic production through the CHIPS Act to reduce reliance on foreign suppliers. Similarly, China unveiled its largest semiconductor investment fund to date, worth $47.5 billion, supported by major state-owned banks.
With Nvidia also facing antitrust scrutiny in the US, the company has become a symbol of the broader struggle for technological supremacy. Any actions against Nvidia could have ripple effects on its leadership in the AI chip market and hinder US efforts to maintain a competitive edge in the AI race.
For more political, business, technological and cultural information visit all of our Mundo Ejecutivo platforms.
