March 2, 2024

Will the US ban technology sales to Huawei?

As of: January 31, 2023 at 10:38 AM

US President Biden's government appears to have stopped issuing export licenses to Chinese telecom giant Huawei. Export restrictions have been in place for a long time, and now there may be a risk of a complete ban.

The sale of US technology to China has been restricted for years, and there is now a risk that measures already in place will be tightened. According to media reports, the government in Washington has suspended the license of American companies to export to the Chinese telecommunications company Huawei. This was reported by the Financial Times and several news agencies, citing people familiar with the process.

A Chinese Foreign Ministry spokesman said today that China is deeply concerned. “We are closely following relevant developments.” It was only in October that the United States imposed new restrictions on China, including export controls on semiconductor technology. This is intended to prevent the Chinese military from modernizing.

Warning against espionage and sabotage

Huawei is the world's largest telecom equipment provider, and entered the mobile phone business in 2003. Last November, the United States also banned smartphones from network suppliers. The United States has long accused Huawei of having close ties with Chinese authorities and warned of espionage and sabotage. The company denies these accusations.

Huawei has faced US export restrictions on 5G networks and other technology for several years. However, officials at the US Department of Commerce still grant licenses to some US companies to sell certain goods and technologies to the company. Qualcomm received permission to sell 4G smartphone chips to Huawei in 2020. Intel is also one of the companies that still gets export licenses for the technology as long as it has nothing to do with 5G.

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“Blacklist” since 2019

Now it seems that the US also wants to ban the delivery of products to Huawei below the 5G level. This will be around the 4G mobile communications standard, Wifi 6 and 7, artificial intelligence, high-performance computers and cloud elements.

US officials blacklisted Huawei in 2019. Accordingly, most US companies are prohibited from supplying goods and technologies to the Chinese group unless they obtain licenses.

Last December, Huawei reported that the group's total revenue reached $91.53 billion. This was slightly lower than in 2021, when US sanctions caused sales to fall by almost a third.