“The Right Way to Sell Chips to China” by Alasdair Phillips-Robins, Noah Tan

Last December, President Trump announced that the United States would allow Nvidia to sell its powerful H200 AI processors to customers in China. Officials in the Trump administration have long argued that the best way to win the AI race is to promote the export of US technology around the world, not to restrict it. Selling H200s, the administration claims, will boost the market share of US chip-makers while preserving the US hardware lead. Critics warn of national security risks to selling advanced chips, but the administration appears committed to its course. Taking a pro-export framework as a given, policymakers can balance between market share and national security by managing a quantity that currently doesn’t receive enough attention: the United States’ relative compute advantage. Total AI compute for a country is calculated as its stock of AI processors weighted by the effectiveness of each processor; the US currently enjoys a roughly 10-to-1 compute advantage over China. That advantage matters because more compute can support more domestic R&D, more customers served by American AI products, and more ability for the US government to influence the development and use of AI. Relative compute advantage is about the quantity of chips as [...] ---Outline:(02:20) A Return to Relative Advantage(05:46) Selling Chips Without Selling Out(08:17) Making Relative Advantage Work in Practice(11:18) Discussion about this post(11:22) Ready for more? --- First published: April 13th, 2026 Source: https://aifrontiersmedia.substack.com/p/the-right-way-to-sell-chips-to-china --- Narrated by TYPE III AUDIO.