Nvidia’s founder and CEO Jensen Huang warned that the US tech industry is at risk of “enormous damage” from the escalating battle over chips between Washington and Beijing, in an interview with the Financial Times published on Wednesday.

Nvidia CEO Jensen Huang speaks during a press conference at The MGM during CES 2018 in Las Vegas on January 7, 2018. (Photo: AFP)

Huang was quoted by the Financial Times as saying that the Biden administration’s export control to slow Chinese semiconductor manufacturing had left the Silicon Valley group unable to sell advanced chips in one of the company’s biggest markets.

Huang said China made up roughly one-third of the US tech industry’s market, and would be impossible to replace as both a source of components and an end market for its products.

“If we are deprived of the Chinese market, we don’t have a contingency for that,” Huang said, “There is no other China, there is only one China.”

Huang added that blocking the US tech industry’s access to China would “cut the Chips Act off at the knee,” referring to the Biden administration’s $52 billion funding package to encourage construction of more semiconductor manufacturing facilities.

As excitement has grown around AI, Nvidia has become the primary source of chips that are used to train the “large language models” that power chatbots such as OpenAI’s ChatGPT and its market capitalization has more than doubled so far this year to about $770 billion.

However, Nvidia has been forced to reconfigure some of its chips to comply with US rules limiting the performance of products sold in China.

Most of the world’s advanced chips, including Nvidia’s, are made in China’s Taiwan. Given the potential tension across Taiwan Strait, analysts fear it will lead to severe global disruption in production of everything from cars to computers.

“We can theoretically build chips outside of Taiwan, but the China market cannot be replaced. That’s impossible,” Huang told FT.

Huang was quoted as saying that China will “just build it themselves” if its companies cannot buy from US suppliers. “So the US has to be careful. China is a very important market for the technology industry,” he told the FT.

(Compiled by Du Ying)