Commentary on Political Economy

Friday 12 March 2021



China Hits Out at New Huawei Curbs, Says U.S. Can’t Be Trusted

Bloomberg News

China blasted President Joe Biden’s administration for imposing new restrictions on national tech champion Huawei Technologies Co., saying the U.S. “isn’t a reliable country that is to be trusted.”

The U.S. informed some Huawei suppliers of tighter conditions on previously approved export licenses, prohibiting items for use in or with 5G devices, according to people familiar with the move. The ban is effective as of this week, they said.

The measure would hurt both the U.S. and China, Foreign Ministry spokesman Zhao Lijian told reporters at a regular press briefing in Beijing on Friday.

“It will severely disrupt the technological exchanges and trade exchanges of the two countries and the world at large, it will undermine the global industrial chains and supply chains,” Zhao said. “The U.S. should stop the suppression on Chinese companies immediately and treat Chinese companies in a fair, just and nondiscriminatory manner.”

Chinese-listed telecom equipment stocks such as Fiberhome Telecommunication Technologies Co. and Shennan Circuits Co. fell more than 1% on Friday, while rival ZTE Corp. was largely unchanged in Hong Kong and down about 1.8% in Shenzhen.

The U.S. rules create a more explicit prohibition on the export of components like semiconductors, antennas and batteries for Huawei 5G devices, making the ban more uniform among licensees. Some companies had previously received licenses that allowed them to keep shipping components to Huawei that it may have then used in 5G equipment, while other firms were already subject to tighter restrictions.

Companies had complained about confusing rules after former President Donald Trump’s administration added Huawei to the Entity List, requiring that U.S. firms obtain government licenses if they want to sell American tech and intellectual property to the Chinese telecommunications-equipment giant. U.S. officials had deemed Huawei a national-security threat.

— With assistance by Philip Glamann, and Colum Murphy

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