By Trevor Hunnicutt and Eduardo Baptista AIR FORCE ONE/GYEONGJU, South Korea (Reuters) -U.S. President Donald Trump said on Wednesday he will speak to Chinese President Xi Jinping about Nvidia's state-of-the-art Blackwell artificial intelligence chip at their expected meeting on Thursday. Sales of the U.S. firm's high-end AI chips to China, which accounted for 13% of its revenue in the past financial year, have been a key sticking point in protracted trade talks between the world's two largest economies this year. Beijing has long been irked by Washington's export controls that ban Nvidia from selling its most advanced AI chips to China. The U.S. has justified these restrictions by alleging the Chinese military would use the chips to increase its capabilities. Speaking to reporters aboard Air Force One en route to Gyeongju, South Korea, Trump praised Nvidia's current flagship Blackwell model as the "super-duper chip" and said he might speak to Xi about it, without elaborating. "I think we may be talking about that with President Xi," Trump said, adding he was "very optimistic" about his meeting with Xi, the first since he returned to the White House. UNCERTAIN CHIP EXPORT CONTROLS The second Trump administration has swung back and forth on allowing Nvidia's advanced chips into China, vacillating on whether access would make its superpower rival more dependent on the U.S. technology or give its military and tech companies a competitive boost. In April, it ordered Nvidia to stop sales of the H20 chip, made specifically for the Chinese market, prompting the company to prepare a less powerful version that was nevertheless based on its newest Blackwell architecture. Washington lifted the H20 sales ban three months later as part of negotiations with China on rare earths exports. Trump also said in August he would allow Nvidia to sell its H20 chips to China in exchange for the U.S. government receiving a 15% cut of the company's sales of some advanced chips in that country, opening the door to allowing the firm to sell more powerful chips than the H20 model. But even after the revenue sharing deal, Nvidia said it has not sent any H20 chips to China, as the U.S. has yet to come up with rules on how to get the payment and China has discouraged domestic firms from purchasing the California-based company's chips. Nvidia CEO Jensen Huang, who is expected to meet Trump on Wednesday and discuss the Blackwell, said on Tuesday his company had not applied for U.S. export licenses to send its newest chips to China because of the Chinese position. "They've made it very clear that they don't want Nvidia to be there right now," he said during the company's developers' event, adding it needs access to the China market to fund U.S.-based research and development. "I hope that will change in the future because I think China is a very important market." Beijing has put pressure on Chinese firms to buy and further develop domestic chips in response to U.S. export controls targeting the sale of Nvidia chips to China. Despite that pressure, Chinese developers still want Nvidia's chips due to constrained supplies of products from domestic rivals such as Huawei, Reuters has previously reported. (Reporting by Trevor Hunnicutt and Eduardo Baptista; Writing by Eduardo Baptista; Editing by Miyoung Kim, Stephen Coates and Muralikumar Anantharaman)
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