Huawei in the centre of US bipolar policies
Country's contradiciting actions are slowly forcing the company to invest in Europe insteadValentina Spiridonova
Competing tensions inside the US administration over country's policy towards China are once again in sight after on Tuesday members of the US Senate and House of Representatives introduced bills to keep tight restrictions on Huawei Technologies Co Ltd - a move that came amid rising speculations that President Donald Trump is preparing to scale back curbs on the Chinese tech giant without an act of Congress.
The so-called Defending America’s 5G Future Act, led by Senators Tom Cotton and Chris Van Hollen, would block the Trump administration from single-handedly allowing Huawei to conduct business with American companies. If approved, it would also keep the Commerce Department from removing the Chinese company from its “Entity List,” codifying a recent Trump administration executive order and will give the Congress the power to disallow waivers granted to US companies doing business with the Chinese giant.
“American companies shouldn’t be in the business of selling our enemies the tools they’ll use to spy on Americans,” Republican Senator Tom Cotton, said in a statement regarding the legislation.
“We must make a concerted effort to confront the threat China poses to US national security, intellectual property, and technology,” Republican Senator Mitt Romney added. “Our bill will prohibit US-based companies from doing business with Huawei until they no longer pose a national security threat.”
The bipartisan piece of legislation comes amid Washington's repeated accusation against Huawei, regarding company's alleged theft of American intellectual property and violations of Iran sanctions. As a result, the Trump administration placed Huawei on the Commerce Department’s so-called Entity List in May over national security concerns, blocking it from buying US software and components without government approval. The move then prompted immediate headaches for Huawei: Google pulled the company’s Android license, chipmakers stopped supplying parts, Microsoft stopped selling Huawei laptops, and the company wouldn’t be allowed to use microSD cards in its devices. Other big US partners of Huawei, however sided with the company, taking a stand against the executive order and reportedly quietly continuing their partnership with the Chinese giant due to fears that their own manufacturing process will suffer heavy losses.
To avoid such harms for the US semiconductor industry, a possible 5G slowdown and worsened ties between China and US late last month, President Donald Trump announced American firms could sell products to Huawei. Commerce Secretary Wilbur Ross also confirmed that licenses would be issued where there is no threat to national security. But once again it remained unclear which product categories are deemed to be safe and it’s worth pointing out that the blacklisting is still effective, meaning it could be enforced once again if trade talks stall.
So it is no surprise that US administration's inability to unite and find common solution on the issue is nevertheless pushing the Chinese telecoms giant away from the US market and making it invest in Europe instead. Last Monday, for instance, the chief executive of the telecoms giant’s Italian unit, Thomas Miao announced the company will invest $3.1bn in Italy over the next three years, while cutting over 1,000 jobs in the United States.