Ross criticized the way in which the Biden administration had moved to block the export of advanced chips to China.
The emergence of DeepSeek shows why tougher controls are needed on the transfer of technology to Beijing, Wilbur Ross, Trump’s first commerce secretary, told National Review.
Ross, in an interview on Tuesday, called the Chinese artificial intelligence model a “pioneering effort” but said that most people missed the fact that it used “a couple thousand” Nvidia chips.
He views DeepSeek as a “partial breakthrough” and said that it will take more experimentation to see how good it really is.
While there has been some conversation about DeepSeek’s reliance on American chips and, potentially, data scraped from OpenAI, concern that the model was developed on a purportedly shoestring budget with the use of minimal computing processors sent Nvidia and other AI-tied stocks tumbling this week.
The company has previously disclosed that it used approximately 2,000 Nvidia H800 processors. But on CNBC last week, Alexandr Wang, the CEO of Scale AI, claimed that DeepSeek uses as many as 50,000 of Nvidia’s advanced H100 computer processors, touching off a conversation about the company’s potential circumvention of export controls.
As commerce secretary during Trump’s first administration, Ross oversaw the imposition of a stringent export control regime intended to block China’s access to advanced technology. Ross called Commerce’s Bureau of Industry and Security — which oversees the export control regime — “one of the gems” of the department and said that it’s one of the few government offices that deserves to be expanded.
“While potentially a big breakthrough, in that it might make AI more efficient both in terms of consumption of chips and consumption of energy, it does not eliminate the need, and even DeepSeek is very dependent on the Nvidia chips. So I think it’s important that those export controls keep being tightened, keep being redefined to meet new challenges, so I think it intensifies the need, but it doesn’t do away with it,” said Ross, who recently published a memoir, Risks and Returns: Creating Success in Business and Life.
Ross criticized the way in which the Biden administration had moved to block the export of advanced chips to China, saying that while rules issued late last year failed to take into account valuable input from the industry, it missed some critical things.
“While it tightened the constraints on Nvidia, it did not deal with the components that go into some of the Nvidia chips for AI, and a lot of those components, particularly the ceramics, are made in Japan and not elsewhere,” he said, adding that DeepSeek and other Chinese firms could buy the ceramics via this loophole, which might not have been left open if the administration had sought industry input.
He also said that he rejects the analysis offered by some experts who claim that export controls have spurred Chinese technological advancement by requiring companies to do more with less.
“Prior to our putting in export controls, China had already spent over $100 billion trying to build up the semiconductor industry, so it’s silly to say, oh they’re just building it up in response to our controls,” he said.
“They were building it up anyway. That’s why we put the controls in.”
Howard Lutnick, Trump’s designate for the top Commerce role in his second administration, told the Senate yesterday that China “stole” the technology underlying DeepSeek and that he would move to tighten export controls.
Ross, who expressed enthusiasm for Lutnick’s nomination, said that the two have spoken numerous times ahead of yesterday’s hearing and that they have known each other for about 40 years.
He added that Trump’s reorganization of the U.S. Trade Representative’s office, so that it reports to the Commerce secretary, is a good thing that will harmonize the enforcement of his forward-leaning trade agenda.
Placing USTR under Commerce, he said, will reduce friction between the two entities, give Lutnick access to detailed technical knowledge on trade, and grant USTR better access to granular trade data from Commerce that it can integrate into its decision-making.
Overall, said Ross, Trump has already begun rolling out an “America First model” of trade policy according to which he leverages tariffs to advance non–trade policy objectives.
He said that Trump used this approach when he used the threat of new tariffs to compel Colombia to accept a deportation flight over the weekend and that he’s using a similar approach against Mexico and Canada.
“The president is in a much stronger position to implement them than he ever had been in his first term,” Ross said. “So there’s no question in my mind that there’s going to be more umph put behind America First.”