Nvidia fallout could hamper US-China trade talks

The fallout surrounding Nvidia CEO Jensen Huang's relationship with a suspected Chinese spy may complicate upcoming US-China trade discussions during the APEC summit, where President Donald Trump is expected to meet with Chinese leader Xi Jinping. The controversy has intensified bipartisan scrutiny of the administration's approach to export controls on AI chips, just months before Democrats are set to take control of Congress.

Analyst Michael Deng, a former Commerce Department official, stated that "Up until this point in time, Trump and the Republican Party had full control over what to do with export controls." However, with the Democratic Party set to assume power, Deng predicts that "the issue going into APEC is the Chinese side is going to know that Trump may not necessarily be able to hold any commitments he makes."

China's willingness to extend the current truce until January suggests they may be trying to capitalize on the Republican Party's midterm losses. Deng believes subsequent extensions will be "progressively harder to negotiate," as lawmakers are already considering various export-control proposals to be included in defense legislation.

US Trade Representative Jamie Greer previously stated that negotiators had "taken export controls off the table as a national security issue." Some experts doubt that Democrats will focus their new power on US-China trade, given their other priorities, such as investigating the Trump family. Caleb Max, CEO of the National Artificial Intelligence Association, added, "It's probably too early to tell" if the Democrats will prioritize US-China trade over other issues.