The Trump administration yesterday took two actions that could effectively prevent Huawei from buying US technology and prevent it from selling products to US companies.
An executive order Issued by President Trump and a separate action taken by the US Commerce Department could “cut off the Chinese telecommunications giant from American suppliers and ban it from doing business in the US,” The Wall Street Journal wrote.
The order did not mention Huawei or China by name, but it is widely seen as a target of Huawei and other Chinese companies such as ZTE. Huawei is the second largest mobile phone vendor in the world, according to IDCand sells a large amount of network equipment to telecommunications providers and other companies.
Trump’s executive order “declare(ed) a national emergency and ban(ed) US companies from using communications equipment that companies pose a national security risk,” Reuters refused. Executive order applies to future transactions only.
Shortly after Trump’s executive order, the Commerce Department said it had added Huawei and 70 affiliates to its so-called Equipment List — a measure that prohibits the telecom giant from buying parts and components from companies USA without the approval of the US government,” Reuters also wrote.
This will make it difficult for Huawei to sell some products due to its reliance on US parts, and could put the use of the Google Play store and Google apps on Android devices at risk. ZTE was temporarily shut down last year after a similar breach prevented it from using Qualcomm chips and Google software. (Huawei makes its own smartphone chips.)
However, the Department of Commerce has not announced all the exact details of the new restrictions, so it is difficult to make specific predictions of what products will be affected. US company tell it “will give instructions within 150 days to establish procedures for reviewing such transactions.”
The US-China trade war widens
The moves widen the trade war between the US and China. Trump’s executive order said the actions were necessary to prevent “economic and corporate immigration to the United States and its people,” as U.S. adversaries could “create and exploit weaknesses in information and communications technology or work, with potentially catastrophic consequences.”
The US government apparently it has not been hard to find hard evidence that Huawei spies on China’s behalf, however. Huawei has called on the US to provide evidence, but “US believes it does not need to present ‘evidence’ Huawei is a spy threat,” a Wall Street Journal article observed in January 2019. A Huawei employee was arrested in Poland in January and accused of spying on Poland for China; Huawei has fired the employee.
“Huawei has denied those charges, and its CEO (Ren Zhengfei) has said he would shut down the company rather than obey Chinese government orders to stop or divert Internet traffic,” New York Times wrote. “American officials say he will have no choice: Chinese law requires that the country’s companies obey instructions from the country’s State Security Agency.”
Both Huawei and the Chinese government condemned the Trump administration’s moves.
“Restricting Huawei from doing business in the US will not make the US safer or stronger; instead, this will only serve to limit the US to smaller yet more expensive alternatives, leaving the US behind in 5G deployment, and damaging interests. of US companies and consumers,” Huawei told CNBC. “In addition, unfair restrictions would violate Huawei’s rights and raise other important legal issues.”
A Chinese foreign ministry spokesman called the US shipments “an abuse of export control measures.” according to the Associated Press.