Nvidia’s Huang warns China will win AI race amid energy costs, regulations

Investing.com -- Nvidia CEO Jensen Huang has issued a stark warning that China will surpass the United States in the artificial intelligence race, citing China’s lower energy costs and less restrictive regulatory environment.

"China is going to win the AI race," Huang stated Wednesday at the Financial Times’ Future of AI Summit. His comments follow the Trump administration’s decision to maintain restrictions on Nvidia selling its most advanced chips to Beijing, despite recent talks between President Donald Trump and Chinese leader Xi Jinping.

Huang criticized what he described as "cynicism" in Western nations including the US and UK, calling for "more optimism" instead. He specifically pointed to the potential burden of "50 new regulations" from various US states implementing their own AI rules.

The Nvidia chief highlighted China’s energy subsidies as a key advantage for local tech companies running Chinese alternatives to Nvidia’s AI chips. "Power is free," Huang remarked, referring to the cost benefits Chinese competitors enjoy.

Recent reports indicate China has increased energy subsidies for major data centers operated by tech giants including ByteDance, Alibaba and Tencent. These subsidies were reportedly implemented after Chinese tech companies complained about higher costs associated with using domestic semiconductors from firms like Huawei and Cambricon, which are generally less energy-efficient than Nvidia products.

Huang has previously cautioned that the latest American AI models hold only a narrow lead over their Chinese counterparts, and has urged the US government to allow more open market access for its chips to maintain global technological dependence.

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