U.S. extends Huawei’s trade reprieve 90 days
WASHINGTON — The United States will allow American companies to continue doing business with Huawei, the Chinese telecommunications giant, for an additional 90 days, Commerce Secretary Wilbur Ross said Monday.
The government’s reprieve is intended to give rural telecommunications companies in the United States more time to wean themselves off Huawei, which supplies many of those providers with parts and equipment. Rural telecom firms in the United States have been scrambling to figure out how they will replace Huawei equipment since President Donald Trump’s administration effectively banned the company from U.S. communications networks in May and have been lobbying the White House for more time.
“As we continue to urge consumers to transition away from Huawei’s products, we recognize that more time is necessary to prevent any disruption,” Ross said in a statement.
In a sign that the administration is not completely easing pressure on Huawei, the Commerce Department said that it was also adding 46 affiliates of Huawei to the list of 69 already affected by a trade blacklist.
In a statement issued
Monday, Huawei called the addition of the affiliates to the so-called entity list “politically motivated” and unrelated to national security and said that it was being treated “unjustly.”
“These actions violate the basic principles of free market competition,” Huawei said in a statement. “Attempts to suppress Huawei’s business won’t help the United States achieve technological leadership.”
The extended limited reprieve applies to technology sales and transfers necessary for “the continued operations of existing networks and to support existing mobile services, including cybersecurity research,” the Commerce Department said in an updated order Monday.
Huawei is China’s biggest phone-maker, and sales to the company account for a significant portion of revenue for some U.S. suppliers.
Huawei has been thrust into the middle of Trump’s trade fight with China, and the president has given mixed signals about the telecom giant’s fate. After trade talks broke down in May, Trump’s Commerce Department added the company to the U.S. entity list that effectively banned the firm from buying American technology and other products without government approval.
Trump has also called the
company a national security threat. The United States has concerns that Huawei could be used to help the Chinese government’s espionage efforts and to disrupt American telecommunications infrastructure in the event of a conflict.
Huawei, for its part, has been trying to carry on operations in face of U.S. sanctions on the sale of the vital technology. The company this month announced its in-house HarmonyOS, an open-source operating system that could one day serve as a replacement for Google Inc.’s Android if its access to that software is curtailed.
Without Android or the numerous American silicon, technology and consultancy suppliers that Huawei does business with, many of its most promising product lines would either cease their rapid growth or be thwarted entirely.
The Commerce Department previously granted a threemonth temporary license to Huawei’s U.S. customers shortly after the Trump administration blacklisted the Chinese company in May. That allowed telecom carriers in rural areas to continue using Huawei equipment and Google to provide only key Android security updates to Huawei phones.
Speaking to reporters Sunday, Trump suggested that there might not be another extension.
“Huawei is a company we may not do business with at all,” he said.
The latest extension came after Trump met in July with the chief executives of key Huawei suppliers from Alphabet Inc.’s Google and Broadcom Inc. to Intel Corp. and Qualcomm Inc. to discuss economic issues including a possible resumption of sales to Huawei. U.S. companies argued that Huawei will turn to non-American suppliers if sanctions persisted, hurting the U.S. in the long run.
The temporary relief for Huawei comes as trade negotiations between the United States and China remain at an impasse.
Trump agreed last week to delay some additional tariffs on toys and electronics until December, but the United States is still expected to impose levies on more Chinese imports on Sept. 1. Earlier this month it labeled China a currency manipulator for the first time since 1994. China is expected to unveil plans to retaliate.
Despite escalating tension, Trump said that he and President Xi Jinping of China were planning to speak and that the two countries would continue to have trade talks.
Republicans and Democrats in Congress have been urging Trump to keep his hard line on Huawei. Lifting the ban outright would likely be met with strong bipartisan disapproval.
The administration’s China hawks want Huawei banned not just from U.S. government networks but also from all U.S. telecommunications and have been trying to persuade U.S. allies to impose blanket bans. But others in the administration seem inclined to use Huawei sanctions as a lever in ongoing trade negotiations.
Trump himself has sent mixed signals. The extension was announced a day after he told reporters the U.S. shouldn’t be doing business with Huawei. In May, Trump issued an executive order under which the Federal Communications Commission is studying whether to institute a ban on Huawei equipment in U.S. telecom networks.
Trump over the weekend indicated the U.S. was “doing very well with China, and talking” but also suggested he wasn’t ready to sign a trade deal.
U.S. stocks rallied Monday after the Trump administration signaled progress on trade negotiations and Ross announced the extension.