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U.S. Commerce official Kessler says China's AI chips are

catching up to U.S.

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Export controls to remain strong amid U.S.-China trade

deal

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White House says Chinese AI chips are 1-2 years behind

U.S.

WASHINGTON, June 12 (Reuters) - China's Huawei

Technologies is capable of producing no more than

200,000 advanced artificial intelligence chips in 2025, a top

U.S. exports controls official told lawmakers on Thursday,

warning that though the number is below the company's demand,

China is quickly catching up to U.S. capabilities.

Since 2019, a slew of U.S. export rules aimed at curbing

China's technological and military advancements have limited

access by Huawei and other Chinese firms to high-end U.S. chips

and the equipment needed to produce them. The issue has become a

flashpoint in U.S.-China relations.

Facing those restrictions, Huawei aims to ship its Ascend 910C

AI chips to Chinese customers as an alternative to those made by

the United States' Nvidia ( NVDA ), the global leader.

"Our assessment is that Huawei Ascend chip production

capacity for 2025 will be at or below 200,000 and we project

that most or all of that will be delivered to companies within

China," Jeffrey Kessler, Under Secretary of Commerce for

Industry and Security at the Commerce Department, told a

congressional hearing.

Kessler said that the U.S. should not take comfort in the

figure.

"China is investing huge amounts to increase its AI chip

production, as well as the capabilities of the chips that it

produces. So, it's critical for us not to have a false sense of

security, to understand that China is catching up quickly," he

told the House of Representatives Foreign Affairs South and

Central Asia subcommittee.

White House AI Czar David Sacks said on Tuesday that China was

only 3-6 months behind the U.S. in AI. The White House later

said he was referring to China's AI models, adding that Chinese

AI chips are one to two years behind their U.S. counterparts.

Huawei's CEO Ren Zhengfei told Chinese state media on Tuesday

that the company's chips were a generation behind those of U.S.

competitors, but that it invests more than $25 billion annually

to improve performance.

Nvidia's ( NVDA ) AI chips are more powerful than Huawei's but

Washington's export controls on its most sophisticated chips

have caused it to lose market share.

The U.S. and China reached a tentative trade truce at talks

in London this week after a previous agreement faltered over

China's continued curbs on minerals exports.

That prompted the Trump administration to apply additional

export controls on shipments of semiconductor design software,

jet engines for Chinese-made planes and other goods.

Democratic Representative Greg Meeks expressed concern that

the Trump administration had conflated U.S. exports controls

with broader discussions on trade.

"What I will say is export controls have been strong and I'm

confident that they will remain strong," Kessler said.

Kessler said he was not planning any immediate new

restrictions on U.S. semiconductors sold to China, but that the

Commerce Department will "remain active in this space."

"It's a constantly evolving landscape, and we need to make

sure that our controls remain effective," he said.