Bangkok, 9 November

China denied on Monday that there was a spy plot to ensnare Nvidia CEO Jensen Huang, calling the spying allegations unsubstantiated and a smear campaign against Beijing.

Huang has acknowledged to the Nvidia board that he had been intimate with a business executive who US intelligence determined was gathering information for Beijing, according to The New York Times.

“The so-called Chinese spy allegation is unsubstantiated. It is nothing but smears against China,” Ministry of Foreign Affairs spokesperson Guo Jiakun said on Monday.

The chips company CEO is at the centre of a controversy over whether he drove sales of advanced computer chips to China, in spite of US tech restrictions aimed at limiting China's ability to access these advanced technologies. Nvidia is one of the world's most valuable publicly traded companies, alongside Apple and Microsoft.

Nvidia said on Sunday that the company would launch an investigation into the case. Huang did not name the person in the extramarital affair.

China had previously denied the New York Times report that said Huang had developed a close relationship with a Chinese citizen named Alice Huang, who ran a company that faced claims of smuggling advanced chips into China, and that she was a spy for Beijing.

“The key questions are whether he was aware of any espionage activities and whether any confidential or strategically sensitive information was compromised,” said George Chen, a partner and chair of digital practice at The Asia Group, a Washington-based consultancy.

“Those questions require evidence rather than speculation,” he added in written comments.

Huang had pushed to loosen chip sales restrictions to China in recent years, successfully lobbying US President Donald Trump to allow his company to sell H200 chips this year. However, it is uncertain if Beijing would allow Chinese companies to buy these chips en masse.

While those chips are not Nvidia's most cutting-edge models, they are still advanced. Previously, Huang also lobbied Trump to sell the less-advanced H20 chips, which were designed for the Chinese market while complying with US export restrictions.

Chinese media have largely focused on Huang admitting to the affair, and state media outlets have mainly echoed the official government line. Some have said the New York Times report was aimed at destabilising US-China relations.

“Whenever China-US relations begin to improve, there are often those firing shots from the shadows,” the state-owned Global Times said.