Newsletter
As part of its efforts to further cripple Huawei’s business, the Biden administration has reportedly ceased granting licenses that allow American companies to export to Huawei, according to The Financial Times.
In 2019, the Trump administration added Huawei to the “entity list,” making it ineligible to receive exports from the US without a license. Nevertheless, the US Department of Commerce granted licenses to companies such as Qualcomm to supply Huawei with technology unrelated to 5G networks, such as 4G chips for smartphones and tablets.
Now the US government is reportedly looking to ban exports altogether, which would significantly affect the supply of a wide range of products, including 4G, Wi-Fi 6 and 7, AI, cloud, and high-performance computing. However, the US commerce department has not confirmed this report, saying only that it continues to assess its policies and regulations.
The Biden administration’s tougher stance on China
It is not clear why the Biden administration is taking a more stringent approach towards Huawei. However, the report from The Times suggests that the ban on the company is the result of Huawei backing projects that aim to build a semiconductor supply chain in China that doesn’t rely on imports and to prevent the Chinese military from using US technology to develop weapons.
A former CIA agent told the publication that the tougher stance on Huawei is because the company is different now compared to when it was added to the entity list in 2021. Back then, the company’s focus was 5G technology. But since the restrictions, Huawei has relied on enterprise and government businesses in China to survive.
However, it is important to note that a complete ban on Huawei would have a major impact on the revenues of its US suppliers. Huawei is one of the largest tech companies in the world, and its suppliers rely heavily on its business. If the ban takes effect, many of these suppliers could lose a significant portion of their revenue.