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https://scmp.com/news/china/article/3022069/us-delaying-huawei-licences-china-stops-buying-farm-goods China
US delaying Huawei licences as China stops buying farm goods
- American businesses need special permission to supply goods to Chinese telecoms giant after it was added to trade blacklist over national security concerns
- US Commerce Secretary Wilbur Ross said last week he has received 50 requests and that decision on them was pending
The Huawei logo on display in Osaka in May. Photo: Kyodo
The White House is holding off on a decision about licences for US companies to restart business with Huawei Technologies after Beijing said it was halting purchases of US farming goods, according to people familiar with the matter.
US Commerce Secretary Wilbur Ross, whose department has vetted the applications to resume sales, said last week he has received 50 requests and that a decision on them was pending.
American businesses require a special licence to supply goods to Huawei after the US added the Chinese telecommunications giant to a trade blacklist in May over national security concerns.
US President Donald Trump said in late June after agreeing to a now-broken trade truce with Chinese President Xi Jinping in Japan that some restrictions on Huawei would be loosened. But that promise was contingent upon China beefing up its purchases from American farmers, which Trump has complained the country has failed to do.
In the past week tensions have escalated further as Trump said he would impose a 10 per cent tariff on US$300 billion of Chinese imports as of September 1, and his Treasury Department formally labelled China a currency manipulator. China meanwhile has suspended purchases of US farm products in retaliation for the latest tariff threat.
Still, Trump said last week there were no plans to reverse the decision he made in Japan to allow more sales by US suppliers of non-sensitive products to Huawei. He said the issue of Huawei is not related to the trade talks.
The White House had no immediate comment.
Technology companies have already made their pitch to the White House for a rapid granting of licences that would allow them to resume some shipments of components to Huawei.
The Chinese company is one of the world’s biggest purchasers of semiconductors. Continuing access to that market is crucial to the fortunes of chip makers such as Intel, Qualcomm and Broadcom. who sent their chief executives to meet Trump in July.
Companies such as Xilinx and Micron Technology have publicly said they have applied for licences and called on the US to allow them to resume doing business with Huawei.
They argue that many of their products are easily obtainable from their overseas rivals, making a ban ineffective and also harmful to the industry that the trade dispute with China is supposed to be helping.
Some US-based makers of electronic components have already reported earnings and given forecasts that show the negative effects of the trade dispute.