China has said that it was drawing up a list of „unreliable“ foreign companies, organisations and individuals for targeting in what could signal retaliation for US sanctions on the Chinese tech powerhouse Huawei.
In an ominous but vague warning, China said Friday that it was drawing up a list of „unreliable“ foreign companies, organisations and individuals for targeting in what could signal retaliation for US sanctions on the Chinese tech powerhouse Huawei.
„We think it may be the beginning of Beijing’s attempt to roll out a retaliatory framework,“ said Paul Triolo of the global risk assessment firm Eurasia Group. „That could include a number of other elements, such as restrictions on rare earth shipments“ — minerals that are crucial in many mobile devices and electric cars made by US companies.
The move follows additional measures this week that deepen the bite of US sanctions imposed on Huawei in mid-May amid an escalating trade war, whose backdrop is the two powers‘ struggle for long-term technological and economic dominance.
Several leading US-based global technology standards-setting groups announced restrictions on Huawei’s participation in their activities under the US Commerce Department restrictions, which bar the sale and transfer of US technology to Huawei without government approval.
Such groups are vital battlegrounds for industry players, who use them to try to influence the development of next-generation technologies in their favor. Excluding Huawei would put the company at serious disadvantage against rivals outside China.
Also Friday, The Financial Times said the company had ordered employees to cancel technical meetings with Americans and sent home US employees working at its Chinese headquarters.
Huawei is the world’s No. 1 network equipment provider and second-largest smartphone maker. US officials claim Huawei is legally beholden to China’s ruling Communists, which could use the company’s products for cyberespionage, though the US has presented no evidence of intentional spying.
In blacklisting Huawei, the Commerce Department cited the company’s theft of intellectual property and evading of Iran sanctions. A 90-day grace period allows continued support of existing Huawei equipment. But under the export restrictions, US suppliers including Qualcomm, Intel, Google and Microsoft cannot ship computer chips, software and other components for new Huawei equipment.
