China To Counter Nvidia Reliance With AI Chip Self-Sufficiency Targets For 2027: Report

According to a report by Nikkei Asia, self-sufficiency targets refer to both semiconductors designed or manufactured by Chinese companies.

China’s largest municipalities are reportedly accelerating plans to replace reliance on U.S. suppliers, with Shanghai aiming for 70% domestic control of AI chips used in data centers by 2027 to counter Nvidia’s (NVDA) dominance in the country.

According to a report by Nikkei Asia, Beijing has gone further, setting a 100% self-sufficiency target in the same period. Guiyang, an inland city in China, has requested that around 90% of the semiconductors be made in China. The report said that the ratio refers to both semiconductors designed or manufactured by Chinese companies.

Nvidia’s stock fell 1.3% in afternoon trade, but retail sentiment on Stocktwits improved to ‘bullish’ from ‘neutral’ over the past day. It was also among the top trending tickers on the platform at the time of writing. The news comes on the heels of reports that Nvidia is developing a new AI chip just for China based on its newest Blackwell framework.

China has reportedly been looking for ways to reduce its reliance on Nvidia’s AI chips amid the tariff war with the U.S. Negotiations between the second-largest economy in the world and the Trump administration are ongoing, with the tariff truce between the two countries now extended till November. 

The Chinese authorities have also reportedly sent notices to a range of firms, forbidding the use of Nvidia’s H20 chips, particularly for any government or national security-related work by state enterprises or private companies.

The new chip that Nvidia is developing is speculated to be more powerful than the current H20 chips, the only ones that the Trump administration has greenlit for export to China, that too for a 15% cut. However, its plans may be moot with China aiming for self-sufficiency.

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