Trump in Damage Control Mode, US Eases Ban on Huawei

A pedestrian talks on the phone while walking past a Huawei Technologies Co. store on January 29

The United States has temporarily eased trade restrictions on China's Huawei to minimise disruption for its customers, a move the founder of the world's largest telecoms equipment maker said meant little because it was already prepared for U.S. action.

Huawei said in February that it generated US$270-million from the sale of network equipment in Canada in 2018 and made US$150-million from its consumer smartphone business here. Shares in tech companies rose Tuesday on the news. In line with this, HSBC has expressed concerns over this uncertainty and is expecting Apple to further increases prices of iPhones in the U.S. if the new import tariffs from China gets enforced.

Huawei launched its new Honor 20 series smartphones in London on Tuesday in a presentation that emphasized the Chinese company's technology but made no reference of a possible rupture with Google.

This follows the U.S. government blacklisting the Chinese company and ordering Google to revoke its Android licence, a move which has serious implications for Huawei's smartphone business.

"Neither Intel, Google or Nvidia do more than three percent of their business with Huawei, so short-term, it shouldn't be an issue". "We are discussing emergency relief measures", he added, without giving details.

Roger Kay, founder and analyst at Endpoint Technologies Associates, said the ban is likely to accelerate efforts by Huawei and other Chinese firms to develop their own sources of microprocessors and other components. That would affect maps or other services that require the American company's support.

The recent US trade restrictions could also have an impact on Huawei smartphones, its second major line of business.

China's government repeated its promise to defend Chinese companies overseas but gave no details of what Beijing might do.

The Commerce Dept. can also choose to extend the 90-day temporary license if neccessary. Presently, BCE and Telus say they have followed government rules and do not use the Chinese vendor's equipment in their network "cores", which carry more sensitive information. The license allows the company to receive software updates and patches for its Android-based phones.

Yesterday, the Commerce Department granted Huawei a license buy USA goods until August 19 to maintain existing telecoms networks and provide software updates to Huawei smartphones.

Huawei founder Ren Zhengfei on Tuesday shrugged off USA attempts to block his company's global ambitions, saying the United States underestimates the telecom giant's strength.

Soon after, the administration effectively blacklisted Huawei, banning any USA companies from doing business with the Chinese telecom giant without permission from the American government.

It hasn't always worked.

John Neuffer, the president of the Semiconductor Industry Association, which represents USA chipmakers and designers, said in a statement that the association wants the government to ease the restrictions further. That has raised the stakes in the trade wars, hurting global commerce and economic growth. The Donald Trump administration is suggesting an increase in import tariffs for products imported from China.

The move came amid an escalating dispute over trade practices between the United States and China.

Attacking Apple might be politically awkward for Chinese leaders who have accused Washington of mistreating Huawei.

But regulators have an array of tools including tax and safety inspections that can hamper a company with no official acknowledgement it is targeted.

Here are some of doubts which the Chinese telecom firm has clarified. In fact, according to reports, there has been a surge in anti-Apple and anti-US messages posted on Weibo, China's version of Twitter, following the new US-China tensions over Huawei. The company reported earlier its global sales rose 19.5% past year over 2017 to 721.2 billion ($105.2 billion).

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