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Sun, 08 Dec 2019 05:01 GMT

US may scale back Huawei trade restrictions to help existing customers

Business

7Dnews London

Sat, 18 May 2019 15:26 GMT

The US said on Friday May 18th that it may scale back its restrictions on China’s tech company Huawei after this week's blacklisting, which would make it nearly impossible for the Chinese company to service its existing customers, Reuters reported.

The government’s Commerce Department, which had effectively halted Huawei's ability to buy American-made parts and components, is considering issuing a temporary general license to "prevent the interruption of existing network operations and equipment," a spokeswoman said.

Potential beneficiaries of the license could, for example include access to the Internet, and mobile phone service providers in thinly populated places such as Wyoming, and eastern Oregon, that purchased network equipment from Huawei in recent years.

In effect, the Commerce Department would allow Huawei to purchase US goods so it can help existing customers maintain the reliability of networks and equipment, but the Chinese firm still would not be allowed to buy American parts and components to manufacture new products.

The potential rule rollback suggests changes to Huawei's supply chain may have immediate, far-reaching and unintended consequences.

The blacklisting, officially known as placing Huawei on the Commerce Department's entity list, was one of two efforts by the Trump administration this week allegedly made in an attempt to thwart national security risks. In an executive order, president Donald Trump also effectively barred the use of its equipment in US telecom networks.

The US believes Huawei's smartphones and network equipment could be used by China to spy on Americans, allegations the company has repeatedly denied.

The latest Commerce Department move comes as China has struck a more aggressive tone in its trade war with the U S, suggesting that further talks between the world's two largest economies would be meaningless, unless Washington changed course.


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