{"id":214708,"date":"2019-05-17T04:52:33","date_gmt":"2019-05-17T08:52:33","guid":{"rendered":"https:\/\/canadianinquirer.net\/v1\/?p=214708"},"modified":"2019-05-17T04:52:33","modified_gmt":"2019-05-17T08:52:33","slug":"us-economic-sanctions-on-huawei-could-backfire","status":"publish","type":"post","link":"https:\/\/canadianinquirer.net\/v1\/2019\/05\/17\/us-economic-sanctions-on-huawei-could-backfire\/","title":{"rendered":"US economic sanctions on Huawei could backfire"},"content":{"rendered":"
\"\"<\/a>
The White House issued an executive order Wednesday apparently aimed at banning\u00a0Huawei’s equipment from U.S. telecom networks and information infrastructure. The U.S. government also said it was subjecting the Chinese company to strict export controls. (File Photo<\/a>: Diego Cambiaso\/Flickr<\/a>, CC BY-SA 2.0<\/a>)<\/figcaption><\/figure>\n

The Trump administration’s plan to restrict exports to Chinese telecommunications powerhouse\u00a0Huawei\u00a0for national security reasons doesn’t just up the ante in the China trade war.<\/p>\n

It could also hurt U.S. suppliers and accelerate Beijing’s drive toward greater technological independence.<\/p>\n

The White House issued an executive order Wednesday apparently aimed at banning\u00a0Huawei’s equipment from U.S. telecom networks and information infrastructure. The U.S. government also said it was subjecting the Chinese company to strict export controls.<\/p>\n

The U.S. government has long insisted that equipment from Chinese suppliers, including\u00a0Huawei, poses an espionage threat. But U.S. officials have presented no evidence of any\u00a0Huawei\u00a0equipment serving as intentional conduits for espionage by Beijing.<\/p>\n

About one-third of\u00a0Huawei’s suppliers are American and, ironically, many of the computer chips, memory and other components it gets from U.S. companies are made in China, said Roger Entner, founder of telecom research firm Recon Analytics.<\/p>\n

The company’s flagship smartphone, the Mate 20 Pro , includes chips made by Skyworks Solutions Inc. and a wireless receiver made by Integrated Device Technologies, both U.S. companies.<\/p>\n

The U.S. sanctions are \u201cgoing to have ripple effects through the entire global telecommunications network,\u201d said Kevin Wolf, who was assistant secretary of commerce for export administration under President Barack Obama.<\/p>\n

If\u00a0Huawei\u00a0\u201dcan’t get the widget or the part or the software update to keep functioning, then those systems go down,\u201d he said.<\/p>\n

The Commerce Department said Wednesday evening that the restrictions would \u201cprevent American technology from being used by foreign owned entities in ways that potentially undermine U.S. national security or foreign policy interests.\u201d<\/p>\n

Huawei\u00a0responded Thursday by saying that having to get U.S. government approval for all purchases of American technology is \u201cin no one’s interest.\u201d<\/p>\n

\u201cIt will do significant economic harm to the American companies with which\u00a0Huawei\u00a0does business, affect tens of thousands of American jobs, and disrupt the current collaboration and mutual trust that exist on the global supply chain,\u201d the company said.<\/p>\n

Huawei\u00a0is already the biggest global supplier of networking equipment, and Entner said it is poised to overtake Samsung as the No. 1 smartphone manufacturer. He said\u00a0Huawei\u00a0is now apt to move toward making all components domestically. China already has a policy seeking technological independence by 2025.<\/p>\n

What’s not clear is whether the U.S. restrictions could include barring Google from licensing components and services of its Android operating system, which Google gives away for free to use on\u00a0Huaweiand other smartphones.<\/p>\n

Former Commerce Department official Wolf said he would need to see a published order to be sure of the scope. Department and Google officials did not immediately respond to requests for clarification.<\/p>\n

Entner said\u00a0Huawei\u00a0would likely be forced to ship its smartphones outside China with a stripped-down Android version used inside China. That package is missing Google’s maps software and its Play Store, from which users buy and download apps, meaning Google could lose revenue.<\/p>\n

While\u00a0Huawei\u00a0has its own mobile processors and chips, the U.S. semiconductor company Qualcomm is a major supplier, he said. Qualcomm declined comment but its regulatory filings indicate\u00a0Huaweirepresented less than 10 per cent of Qualcomm’s revenue last year.<\/p>\n

While the export controls could keep U.S. technologies away from\u00a0Huawei, the separate executive order could effectively ban imports of\u00a0Huawei\u00a0products into the U.S. That order declares a national economic emergency that empowers the government to ban the technology and services of \u201cforeign adversaries\u201d deemed to pose \u201cunacceptable risks\u201d to national security — including from cyberespionage and sabotage.<\/p>\n

Huawei\u00a0vehemently denies involvement in Chinese spying and said blocking it from doing business in the United States would hamper the introduction of next-generation 5G communications technology.Huawei\u00a0is a world leader in 5G, and Entner said\u00a0Huawei’s 5G devices use domestically produced technology, meaning they don’t need U.S. components.<\/p>\n

Huawei\u00a0said the measure would instead limit U.S. companies and consumers to \u201cinferior yet more expensive alternatives.\u201d<\/p>\n

Adam Segal, cybersecurity director at the Council on Foreign Relations, said the executive order \u201csignals to U.S. friends and allies how far Washington is willing to go to block\u00a0Huawei.\u201d<\/p>\n

But European nations have resisted U.S. entreaties to ban the company’s equipment from their 5G networks. The leaders of Germany and the Netherlands made it clear Thursday that they don’t plan to change their stance in light of the newly announced U.S. measures.<\/p>\n

All major U.S. wireless carriers and internet providers had already sworn off Chinese-made equipment after a 2012 report by the House Intelligence Committee said\u00a0Huawei\u00a0and ZTE, China’s No. 2 telecoms equipment company, should be excluded as enablers of Beijing-directed espionage.<\/p>\n

Last year, Trump signed a bill that barred the U.S. government and its contractors from using equipment from the Chinese suppliers.<\/p>\n

Huawei’s smartphones are virtually nonexistent in the U.S., and last week the FCC rejected a Chinese phone company’s bid to provide domestic service .<\/p>\n

Huawei\u00a0says it supplies 45 of the world’s top 50
\ntelecommunications companies. But only about 2 per cent of telecom
\nequipment purchased by North American carriers in 2017 was made by
\nHuawei.<\/p>\n

The domestic economic impact will be restricted mostly to small rural carriers for whom\u00a0Huawei\u00a0equipment has been attractive because of its lower costs. That could make it more difficult to expand access to speedy internet in rural areas.<\/p>\n

Many of those carriers also provide roaming coverage for the major wireless companies.<\/p>\n

——<\/p>\n

Associated Press writers Tali Arbel in New York and Joe McDonald in Beijing contributed to this report.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Trump administration’s plan to restrict exports to Chinese telecommunications powerhouse\u00a0Huawei\u00a0for national security reasons doesn’t just up the ante in …<\/p>\n","protected":false},"author":33,"featured_media":213317,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,17],"tags":[],"class_list":["post-214708","post","type-post","status-publish","format-standard","has-post-thumbnail","category-news","category-news-w","mauthors-frank-bajak","mauthors-the-associated-press"],"_links":{"self":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/214708","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/users\/33"}],"replies":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/comments?post=214708"}],"version-history":[{"count":1,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/214708\/revisions"}],"predecessor-version":[{"id":214709,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/214708\/revisions\/214709"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media\/213317"}],"wp:attachment":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media?parent=214708"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/categories?post=214708"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/tags?post=214708"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}