No turning the other cheek on Huawei
Following a botched 18-month campaign to deny the Chinese telecommunications company access to critical international supplies and key overseas markets, the United States Commerce Department announced a third round of sanctions on Huawei on Friday in a bid to tighten its stranglehold on the company.
Huawei is bracing for an unprecedented survival test. But from the very beginning, this has not been just about Huawei. The campaign against Huawei has always been a part of Washington’s broader efforts to suppress the rise of Chinese technologies. Since 2012, when Huawei was labeled a security risk by a US congressional panel, it has been clear that the company has been singled out because it is the poster boy of an increasingly hi-tech China.
Washington has never offered any credible proof for its claims the company is a security risk, nor have Washington politicians concealed their anxieties about Chinese companies such as Huawei undermining US technological superiority.
“The so-called cybersecurity reasons are merely an excuse … The key is the threat to the technology hegemony of the US,” one Huawei executive said after the restrictions were unveiled on Friday.
As mean as they sound and as hollow as the claims are, the US attempts to crush Huawei have severely poisoned the political atmosphere and are threatening to not only upend the global telecommunications sector, but also raise fears of an upcoming China-US tech war, as part of the broader new Cold War that Washington is trying to wage.
Competition has become the new normal of bilateral relations over the past few years, and technology has become a key arena for this. With China rapidly reducing the technological advantage the US has enjoyed, China hawks in the US are seeking a comprehensive science and technology decoupling.
Huawei was not underestimating the ramifications of the move when it said the “whole industry would pay a terrible price”. Plunges in the stock prices of major Huawei suppliers on Monday were just an initial indicator of the potential domino effect Washington may trigger.
“This new rule will impact the expansion, maintenance, and continuous operations of networks worth hundreds of billions of dollars that we have rolled out in more than 170 countries,” Huawei warned, along with communication services for more than 3 billion users of Huawei products and services.
Huawei’s US suppliers have also complained, saying the new restrictions will cost them billions of dollars in potential lost sales.
That is before taking into account the cost of almost inevitable escalation of the political tug-ofwar between the two countries.
The Chinese Commerce Ministry vowed on Sunday to “take all necessary measures” in Huawei’s defense, with leading US companies such as Apple, Cisco and Qualcomm expected to be in the firing line when Beijing retaliates.