Bunger On U.S. & China Relationship — Huawei Is Barred By Trump
The technological world is advancing with each passing day, and to be honest, everyone’s getting a hold of newly developed alliances. Even the tech rivals have taken aboard multiple suppliers, providing them with chips such as Apple Inc. is getting their processors from Intel. Many such alliances are operational in the tech world, and politics doesn’t impact their relationship.
But the scenario is pretty different from the U.S-China trade war because the United States isn’t letting Huawei work at its top capability. Over the rule of Trump administration, people have been having issues in multiple aspects of their lives. Recently, the Trump Administration has said that Huawei will not be able to use American technology and software.
The commerce department of the United States of America has announced new rules and tactics which have threatened Huawei’s operation. These new rules are going to put bunger on the U.S-China trade war even more and will upset the relationship even more. It’s needless to say that the White House has started a new war with the Chinese telecom entity, Huawei.
With these notions, the tensions are going to rise in Beijing. This change in rules is highly likely to be implemented by September with which, the companies all around the world will be banned from using the American software, equipment, and machinery if they have to design chips for Huawei. According to insights, companies can easily apply for a license.
The licenses can be applied for continual of product supply, but there are high chances that all such license requests will be declined (one doesn’t need to bother applying for a license, maybe!) We have even added what John Neuffer, the president of the Semiconductor Industry Association has to say about this entire fiasco put up by the U.S.
According to John Neuffer, this new rule has created disruption and uncertainty in the entire semiconductor supply chain on a global scale. He has been representing the chip makers for years, but even more, the changes are pretty less damaging as compared to the administrational changes that were to be implied before (the broad aspect has been considered by him!)
It’s needless to say that this move is basically focused on firing at the back of Huawei because they are relying on the American software designs and machinery. Huawei uses these supplies for making chops for the tablets and smartphones. A similar notion will be implied to other companies who are supplying these chips.
According to the Trump administration, they have lined out Huawei because they are posing threats to national security. This is because those gears and chips are designed by the interference of the Chinese government because Huawei operates from China; however, the company has denied all such accusations.
The past year, Huawei was restricted by the U.S. government for the first time, and this measure is merely an extension of those restrictions. The Trump Administration has made Huawei a part of the entity list past May through which the American product export was barred to Huawei. In addition to Huawei, other 114 affiliates have been restricted as well
As we have already mentioned that those affiliates might be exempted from the barring if they obtain the licenses. Ever since the rules have been made, Huawei has managed to reduce their dependence on the American chip manufacturers. The manufacturers include Qualcomm because Huawei is now working on its own in-house production.
Huawei will now design and manufacture their own chips through the chip unit, HiSilicon. However, we need to accept the factor that HiSilicon is still relying on other manufacturers for a few parts, such as Semiconductor Manufacturing International Corporation, that is Shanghai-based. In addition, they are getting help from the Taiwan Semiconductor Manufacturing Company as well.
These partnerships are part of Huawei’s HiSilicon production because they want to work on the mass production of chips according to the specifications. Again, the majority of those companies are also implying the technologies that were basically designed and refined in the United States of America because that’s the prime origin of the semiconductor world.
According to the statement passed by the Commerce Department, they have said that Huawei has always tried to undermine the restrictions imposed by the United States. This is because Huawei was already using the American machinery and software for the production of its semiconductor. The undermining was conducted because Huawei was buying the products from other suppliers (those suppliers were also using the American machinery and equipment!)
Wilbur Ross, the commerce secretary, has passed a statement in Fox Business Network through which he depicted that Huawei managed to find a technical loophole through which they were indirectly using U.S. technology. In his words, these were the tailored moves taken by Huawei, and the Trump Administration has tried to correct that loophole with this latest restriction.
The companies like Semiconductor Manufacturing International Corporation and Taiwan Semiconductor Manufacturing Company already rely on the American equipment for chip manufacturing. This restriction has also reduced the number of sales for Lam Research, Applied Materials, and KLA and other chip design software companies.
This new restriction has caused undeniable tensions between China and the United States. Even more, the U.S President, Trump has also blamed China for the coronavirus pandemic, and according to him, he will be punishing China for this pandemic. Similarly, he has threatened to cut off ties with the Chinese government regarding their latest January deal.
After the latest rules and restrictions imposed by the U.S., the Chinese commerce industry has opposed all those rules. They have promised to take every possible measure that will protect the Chinese firms and their interests. The ministry has even asked the U.S. government to stop taking such actions. The rule was imposed last Friday, but the grace period of 120 days has been set.
According to the Chinese government’s statement, the United States have utilized its national security and national power to suppress Huawei and is trying the wrong ways to put a bar on exports!
Originally published at https://audiovisualaoce.com on May 27, 2020.
