The attack on Huawei, China can counteract US firms themselves

If Washington tries to block the export of technology to Chinese firms like Huawei, American companies may face uncertain future. On May ...


If Washington tries to block the export of technology to Chinese firms like Huawei, American companies may face uncertain future.

On May 15, the US Department of Commerce announced that China's telecommunications giant Huawei (China) will be put on the export control list - a move that could pave the way for a ban on technology sales. America for this company. Earlier on the same day, US President Donald Trump signed an executive decree declaring a national emergency, restricting telecommunications equipment that the US Secretary of Commerce declared a threat to US national security. . (The decree does not specify the names of companies or countries, but experts believe it is aimed at China in general and Huawei in particular.)


A chip from Huawei (China). Photo: ImagineChina.

However, the decision to bring Huawei into the so-called "Entity List" is likely to bring unpredictable consequences to the US side. Contrary to the common views of Trump government officials and US senators, experts say that the consequences of "hitting" Huawei like this could be more catastrophic for US technology companies than they are. Huawei.

This new move differs from President Trump's ban in 2018 aimed at export goods to China's telecommunications company ZTE - this order was issued and canceled. The new move does not immediately ban the sale of US technology components to Huawei. Once the list is officially announced, US companies will be required to apply for a special license to sell to Huawei.

Unexpected consequences

Jim Lewis, vice president and technology expert at the Center for Strategic and International Studies (CSIS, USA), said: "Huawei has stocked up a few US components in the past few weeks, which suggests it could. there are some American components that this company cannot replace. ” However, he said, the situation is not the same as the previous ZTE case because the US Department of Commerce can license some US technologies to be sold, at least for a short time.

Experts see Huawei as a firm with a high degree of resilience even before a complete export ban.

Jimmy Goodrich, vice president of global policy at the Semiconductor Industry Association (US), said that with this latest move, the United States created itself great risks.

Goodrich said recently in Washington: "There is no industry that American companies dominate completely. If America acts unilaterally in this space, then they will eventually hurt creativity in the US while China will still get the technology they care about. ”

Goodrich added: "We have to think about the unintended consequences. Back a year ago, we all know what happened to ZTE. It is no coincidence that China has announced several hundred million USD programs to promote the localization of many 5G elements. Are we going to push them to get better, and become independent of us? ”.

US leaders have not grasped the situation?

While the US semiconductor industry is well aware of the dangers of export bans on US domestic companies, Washington seems to be slow to realize the great steps China has taken.

According to a recent analysis by Japanese research firm Techanalye, Huawei is on par with Apple of the US in terms of 4G chip design for smartphones. Research shows that Huawei has been able or will soon be able to compete with US semiconductor maker Qualcomm in terms of mobile chip design. Currently Qualcomm is still the world's No. 1 mobile microchip, but that's largely due to 65% of revenues from China.

The ban on Huawei shadowing US-China trade negotiations VOV.VN - The prospect of US-China trade negotiations is very dark after the administration of President Trump banned Huawei from buying US technology.

But the Trump government and American congressional MPs don't seem to realize it.

Republican Senator Marco Rubio said he enthusiastically supported the US Commerce Department's decision to stop export incentives for Huawei. According to him, "Huawei is a national power tool directed by the state and used by the Chinese government to defeat its international competitors."

Meanwhile, Republican Senator Tom Cotton views the US Department of Commerce's relevant decisions as a death sentence for Huawei. He earlier this year lobbied for a bill that, if passed, would ban exports entirely to Huawei.

China is quite calm

The reaction was quite indifferent from Beijing and Huawei showed that MPs like Rubio and Cotton might have mistakenly assessed that the new move of Trump and the US Department of Commerce has the effect of hitting "thunder" into Chinese rival.

Derek Scissors, a Chinese expert at the American Enterprise Institute, said: "Trade negotiations face some challenges. Because the US Department of Commerce can be solid or soft in licensing, so the US side has a bit of an advantage in negotiations. But just a little bit in the context of the role of many other factors.

A spokesman for the US State Department said this: "We require our companies to comply with export control laws and regulations and fulfill our international obligations. We require our companies to comply with local laws and policies when doing business abroad ”.

On the other hand, Mr. Lu said that China urged the US to "stop wrongdoing."

Meanwhile Huawei's announcement stated that "restricting Huawei's business in the US will not make the US safer or stronger ... but only make the US limited to less expensive but more expensive options , making America obsolete about 5G development and ultimately harming the interests of American companies and consumers. ”

For his part, Mr. Goodrich urged US policy makers to reconsider their approach.
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High Tech Brain: The attack on Huawei, China can counteract US firms themselves
The attack on Huawei, China can counteract US firms themselves
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