JAKARTA (TheInsiderStories) – United States (US) President Donald Trump gives another pressure on China to reach a trade deal. Trump signed an order to restrict access for Huawei Technologies Co., into the US market and suppliers.
Shortly afterward, the US Commerce Department said it had put Huawei and 70 of its affiliates on a blacklist that could prohibit it from doing business with American companies. In the executive order, which didn’t name any countries or companies, Trump declared a national emergency relating to threats against information and communications technology and services. That could effectively halt business for some of Huawei’s product lines that rely on American suppliers.
The department’ move to put Huawei on its “Entity List”, means US companies will need a special license to sell products to the Chinese company. A similar move against ZTE last year nearly forced the company to shut down before Trump intervened and a deal was reached.
The US government, along with several other nations, has long suspected that Huawei is using its 5G broadband network to spy on behalf of the Chinese government. Last month, the Times of London reported that the Central Intelligence Agency (CIA) has evidence that Huawei “has received funding from branches of Beijing’s state security apparatus” and shared that information with the United Kingdom (UK) to pressure its ally not to adopt Huawei’s 5G network.
“The President has made it clear that this Administration will do what it takes to keep America safe and prosperous, and to protect America from foreign adversaries who are actively and increasingly creating and exploiting vulnerabilities in information and communications technology infrastructure and services,” the White House said in a statement.
Responded the decision, Huawei stated that Trump’ restriction will not make the US safer or stronger. In its official statement, Huawei management said that it will only limit the US into cheaper alternative sources and make the US lags behind in 5G technology development.
Huawei has vehemently denied the spying accusations. Its CEO even recently stated that the firm was willing to sign “no-spy” agreements with foreign governments such as the UK to ease concerns and open up a business. But those promises weren’t enough to stop the Trump administration from taking major steps that will limit business with Huawei over security concerns.
This isn’t the start of Huawei’s troubles with the US government. In January, US federal prosecutors charged the company and one of its top executives with 23 indictments for allegedly stealing US trade secrets and other crimes, and requested to extradite Huawei’s CFO, Meng Wanzhou, from Canada, where she is being held under charges of fraud.
In the end, it will harm US companies and consumers, according to the company. US official claimed to do the restriction, following charges against Huawei and some other companies in January, for giving the banned financial services to Iran. Huawei is considered being involved in conflicting activities to US national security or foreign policy interest.
While the US isn’t alone in its legitimate concerns about Huawei’s 5G technology, the executive order, and national emergency isn’t all about security; it’s inextricably tied to this political moment and an intensifying trade war.
The executive order comes at a time when the tit-for-tat trade war between China and the US is rapidly escalating. Since 2018, the president has launched a series of higher and higher tariffs on Chinese imports into the US, and Beijing in return has done the same for US imports.
Last year, the US imposed tariffs of up to 25 percent on US$250 billion in Chinese goods, from handbags to railway equipment, out of $539 billion in Chinese imports total. China followed suit, imposing tariffs on $110 billion worth of goods (out of $120 billion in US imports, total). Currently, the US is upping the ante to increase its tariffs up to 25 percent on virtually all Chinese imports — hitting an additional $300 billion.
Hopes that the countries could reach an economic ceasefire were crushed last week when two days of intense trade negotiations fell apart in Washington. Shortly after the talks ended, Trump raised the rate of $200 billion worth of Chinese products, particularly auto parts, from 10 to 25 percent. China, in turn, announced it would significantly raise taxes on a large but undisclosed total amount of American goods, including natural gas from 10 to 25 percent.
Written by Lexy Nantu, Email: email@example.com