Analysis: It’s not just Huawei. Trump’s new tech sector order could ripple through global supply chains.
A Chinese man is silhouetted near the Huawei logo in Beijing. By Graham Webster May 18 at 12:18 PM The gloves are coming off against Chinese tech giant Huawei. The Trump administration took two major steps on Wednesday to address long-standing U.S. government concerns about national security and information technology infrastructure from China.
The U.S. government now can block or require conditions for transactions involving ICT products or services even tenuously linked to a “foreign adversary” — a category the executive order defines flexibly as a country, company or person “engaged in a long-term pattern or serious instances of conduct significantly adverse to” national security or to security and safety of U.S. citizens or businesses.
Public warnings date back to a 2012 House Intelligence Committee report that urged against using equipment from Huawei or the smaller Chinese firm ZTE. With this week’s order, the U.S. government is fully empowered to block U.S. companies from using Huawei equipment just as work begins on next-generation 5G wireless networks around the world.Selling U.S.
If the government were to deny all Huawei-related licenses, the fallout could be catastrophic for many of the company’s product lines, which range from infrastructure-level network gear to smartphones. Here’s why: Many of these products use computer chips or other specialized components from U.S. companies, some of which would be hard or impossible to replace with non-U. S. alternatives.
When it comes to the broad new regulatory powers of the executive order, the government has 150 days to develop more specific rules for implementation. Officials could structure their efforts in a targeted and transparent way — or they could give themselves broad and opaque authorities. One Department of Homeland Security official reportedly said the government would look broadly at risks, but “I’m hoping we’ll be able to narrow.
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