According to reports, the US Department of Commerce is ready to give US Huawei suppliers another special 90-day license. The first license of 90 days expires on Monday and allowed the Chinese manufacturer to obtain parts and software from the US. Being able to serve existing customers and update existing phones. But although this is presumably happening under the aegis of trade secretary Wilbur Ross, Reuters reported Sunday that US President Donald Trump had some not-so-kind words for Huawei.
Trump said shortly before boarding Air Force One in New Jersey, he does not want the US government to do business with Huawei because they are a threat to national security. We discussed it earlier, and for new readers, we will repeat the topic; According to its laws, the communist government in China may request that Huawei collect intelligence for this. Thus, US legislators, worried that Huawei’s phones and network equipment contain backdoors, described the company as a threat to national security. Huawei has denied it many times and President Liang Hua has offered to sign a “No Spy” agreement with any country. The US warned their allies not to use Huawei’s network equipment for 5G networks and forced Verizon and AT&T not to carry Huawei Mate 10 Pro last year as originally planned.
Trump did not respond to reporters who questioned him about the second round of 90-day special licenses for US suppliers. Something lost in the damage to Huawei’s operations is the fact that US companies like Qualcomm, Micron, Intel, and others face the loss of much of Huawei’s business that generated $11 billion in revenue last year. Huawei turned out to be Micron’s largest customer in 2018; The American company sells memory chips.
Why Did Trump Treat Huawei And ZTE So Differently?
Although Trump is extremely tough on Huawei, it doesn’t match the way he handled the ZTE export ban last year. In April 2018, the Commerce Department banned the Chinese phone manufacturer from obtaining parts and software from the US supply chain. Does it sound familiar? And although ZTE was the fourth most popular smartphone brand in the US. At that time, lawmakers also considered it a threat to national security in the US for the same reason as Huawei. The company was forbidden to obtain parts of American origin because it lied to the Commerce Department about the following sanctions imposed for the sale of goods and services to North Korea and Iran; this violates US economic sanctions against those two countries.
Unlike Huawei, which has accumulated chips and developed its own operating system in anticipation of a devastating US action against him, ZTE was surprised without preparation. Reportedly, his business had serious problems and then President Trump intervened. Trump posted a tweet asking the Commerce Department to establish an agreement with ZTE because “too many jobs have been lost in China”. Finally, the Commerce Department has reached an agreement that has seen ZTE pay a fine of $1 billion and put $400 million into custody to cover future violations. The company also had to replace its board of directors, hire new executives and allow a US team. I will monitor you to make sure it is correct. The agreement allowed ZTE to obtain US components and software and its business was saved.
Going back to Huawei, White House economic consultant Lawrence Kudlow told NBC-TV’s Meet the Press on Sunday that the second 90-day postponement was approved to show good faith to the Chinese while both countries try to reach a new trade agreement. A few months ago, the president said that Huawei’s ban could be used as currency during trade talks in the US.
He said on May 23: “So it’s possible that Huawei even would be included in some kind of a trade deal. If we made a deal, I could imagine Huawei being possibly included in some form, some part of a trade deal.” Even so, it remains to be seen if the US will remove Huawei from the list of entities even if a commercial agreement is reached.
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