Nvidia chips pile up in Hong Kong as China withholds import approval

Approximately 600,000 Nvidia artificial intelligence chips are currently held in Hong Kong, waiting for shipment to China, according to sources familiar with the situation. This large stockpile of H200 chips highlights Beijing's reluctance to increase dependence on US technology. Despite this, Chinese companies urgently require Nvidia's advanced computing power to meet rising AI demand in the world's second-largest economy.

China has permitted some chip imports in recent months, with several major Chinese internet firms acquiring around 10,000 H200 chips each in the past few months. The exact number of chips shipped via intermediaries and indirect routes remains unclear. China's Ministry of Industry and Information Technology and the National Development and Reform Commission did not respond to inquiries regarding the approval of larger import volumes.

Neither did Nvidia, Alibaba, ByteDance, DeepSeek, nor Tencent. The H200 chip, although not Nvidia's most recent AI processor, still outperforms Chinese alternatives in training AI models, thanks to its compatibility with Nvidia's software. US export controls since 2022 have aimed to limit China's access to advanced Nvidia chips and related equipment, leaving Chinese buyers to resort to intermediaries and indirect methods, which have driven prices up in the unofficial market.