‘Time is up’: US intensifies effort to break Huawei supply chains
President Trump’s administration unveiled new regulations to limit Huawei’s ability to purchase critical technology from foreign companies. “The Trump Administration sees Huawei for what it is — an arm of the Chinese Communist Party’s (CCP’s) surveillance state — and we have taken action accordingly,” Secretary of State Mike Pompeo said Monday. “The United States has provided ample time for affected companies and persons — primarily Huawei customers — to identify and shift to other sources of equipment, software, and technology and wind-down their operations. Now that time is up.” Pompeo issued that statement in conjunction with a new decision from the Commerce Department, which barred 38 Huawei affiliates from doing business with foreign companies that use U.S. technology. The restrictions could deprive the company of key resources in a race to build 5G wireless telecommunications infrastructure for other countries, which U.S. officials say would allow Chinese intelligence agencies to control Western data. “We will not tolerate efforts by the CCP to undermine the privacy of our citizens, our businesses’ intellectual property, or the integrity of next-generation networks worldwide,” Pompeo said. “We are backing up our words with actions across the U.S. Government.”
The new actions come as the Democratic convention kicks off on Monday. Which candidate, Trump or Joe Biden, is toughest on China is likely to be a major issue in the campaign. Some China hawks doubt the efficacy of such pronouncements based on the Commerce Department’s history of providing waivers that softened the impact of the restrictions. The Commerce Department hinted at providing such regulatory relief in the future “by making a limited permanent authorization for the Huawei entities” to continue doing business that involves “ongoing security research critical to maintaining the integrity and reliability of existing and currently ‘fully operational networks’ and equipment.” The new rules also require companies to apply for licenses that could draw scrutiny from Commerce Department officials, but the significance of that switch depends on whether the applications for major deals are denied. “And the license process is secret,” the American Enterprise Institute’s Derek Scissors said. “All that's been done is to jam Huawei transactions into a black box.”
Pompeo sounded more confident on the strictness of the crackdown. “The Department of State has engaged in vigorous diplomacy for more than a year to share what we know about Huawei and other untrustworthy vendors with allies and partners around the world,” he said. “The United States will continue to restrict most U.S. exports to Huawei and its affiliates on the Entity List for activities that threaten U.S. national security and international stability. We urge our allies and partners to join us.”
https://www.washingtonexaminer.com/policy/defense-national-security/time-is-up-us-intensifies-effort-to-break-huawei-supply-chains