“One person familiar with the matter said U.S. officials are creating a new formal policy of denial for shipping items to Huawei that would include items below the 5G level, including 4G items, Wi-Fi 6 and 7, artificial intelligence, and high-performance computing and cloud items.”
The U.S. will no longer provide export licenses to companies shipping items to Huawei – the Chinese Communist Party-controlled company that has increasingly become a pariah in the Western world.
While the U.S. had already put significant restrictions on Huawei – banning Huawei from providing 5G networks for example – export licenses had been granted to some US companies doing business with Huawei.
Now, that will no longer be the case.
According to CNBC, no further exported licenses will be granted:
“One person familiar with the matter said U.S. officials are creating a new formal policy of denial for shipping items to Huawei that would include items below the 5G level, including 4G items, Wi-Fi 6 and 7, artificial intelligence, and high-performance computing and cloud items.
Another person said the move was expected to reflect the Biden administration’s tightening of policy on Huawei over the past year. Licenses for 4G chips that could not be used for 5G, which might have been approved earlier, were being denied, the person said. Toward the end of the Trump administration and early in the Biden administration, officials had still granted licenses for items specific to 4G applications.”
Decoupling continues
As much as officials in both the West and in China claim that ‘decoupling’ is not happening, that is indeed what is taking place.
Both the emergence of Covid from China and Russia’s invasion of Ukraine have shown why relying upon trade with authoritarian states is too big a risk.
Also, as China watched the West sanction Russia and reduce reliance upon Russian energy, the Chinese Communist Party has learned that they won’t be able to get away with aggression against their neighbors without a strong economic response.
So, both the West and the authoritarian states have an incentive to decouple.
As a result, we should expect to see more moves to push China-controlled companies out of the West in the coming months and years.
Spencer Fernando
