Sunday, 09 May 2021

Biden offers Huawei no respite with new restrictions

by Harry Baldock, Total Telecom
Friday 12 March 21

Any hopes that Huawei had for new President Joe Biden to relax sanctions against them seem to be dashed today, with new restrictions reportedly being put in place

The past year has been a difficult one for Huawei, with the Trump administration layering on sanctions throughout 2020, increasingly limiting the Chinese vendor’s ability to do business with US companies, and encouraging nation’s overseas to follow suit. By the end of Trump’s presidency, the geopolitical struggle between China and the US was showing now signs of slowing…

The past year has been a difficult one for Huawei, with the Trump administration layering on sanctions throughout 2020, increasingly limiting the Chinese vendor’s ability to do business with US companies, and encouraging nation’s overseas to follow suit. By the end of Trump’s presidency, the geopolitical struggle between China and the US was showing now signs of slowing, with the final blows landing in January, when the US government denied a raft of 116 licence requests with a total value of around $119 billion. 
 
The inauguration of Joe Biden as President at the end of January was hoped by many, perhaps naively, to usher in a cooling of tensions between the two countries. While the chances of Biden immediately reversing any of the sanctions implemented by the Trump administration were slim – the new president was busy handling the fallout of a rocky election process and the coronavirus pandemic, as well as being a notably outspoken critic of China – there was a feeling that, at the very least, the dialogue surrounding the two countries would be less inflamed. 
 
But today it seems Biden will follow in Trump’s footsteps when it comes to his approach to China and Huawei, with sources suggesting that he is amending the licences that allow companies to sell to Chinese firms, blocking them from supplying items that can be used with 5G devices. 
 
This is not so much a new policy as much as a tightening of previously implemented restrictions. Initial export licences were granted by the Commerce Department after Huawei was blacklisted in 2019, but since then export licences valuing around $87 billion have been approved. The new restrictions being introduced will impact some of these older licences, bringing them more in-line with current restrictions on Huawei.
 
Huawei, who have proclaimed their innocence throughout this saga with the US, said that the US was no longer “a reliable country that is to be trusted”.
 
“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,” said Foreign Ministry spokesman Zhao Lijian. “The U.S. should stop the suppression on Chinese companies immediately and treat Chinese companies in a fair, just and nondiscriminatory manner.”
 
While it is still very much early days for the Biden administration, initial signs suggest that Huawei’s troubles will not be going away any time soon.
 
 
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