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 U.S.-China tensions ratcheted up once again


Thursday, May 16, 2019

In the last 24 hours, U.S.-China tensions ratcheted up once again, this time by several notches.

On Wednesday, May 15, Donald Trump issued an executive order instructing the commerce secretary, Wilbur Ross, to ban transactions “posing an unacceptable risk.” Although not singled out by name, Huawei was the target. The Commerce Department separately announced “that it had placed the company and its dozens of affiliates on a list of firms deemed a risk to national security,” per the New York Times (porous paywall).

Huawei is already effectively excluded from the U.S. market. If the threat implicit in the executive order goes through, Huawei will not be able to buy American-made components that are vital to its supply chain.

Qualcomm, Intel, and Broadcom are among Huawei’s American suppliers who stand to lose business.

Because so many global mobile network operators are dependent on Huawei equipment, the knock-on effects could be felt worldwide.

Huawei “has been preparing for almost a year” for this eventuality, says the South China Morning Post, by stockpiling American components.  

For more on why the latest American move could be so consequential for Huawei and China, see Bloomberg’s Huawei threat by Trump is nuclear option to halt China’s rise (porous paywall) or this Twitter thread by Bloomberg journalist Joe Weisenthal.

On Thursday, May 16, at the Chinese foreign ministry’s regular media briefing, the spokesperson announced that the two Canadians detained after the arrest of Huawei CFO Mèng Wǎnzhōu 孟晚舟 in apparent retaliation have been formally charged.

Former diplomat and International Crisis Group associate Michael Kovrig was charged with gathering state secrets, while entrepreneur and North Korea specialist Michael Spavor was charged with stealing and providing secrets for overseas forces.

Kovrig and Spavor were originally detained in December 2018. The formal arrest “means the cases are still in the investigation phase but now the prosecutors are directly involved as well as the public security forces,” explains Maggie Lewis in this informative Twitter thread.

Other Huawei news:

"News from the Netherlands: intelligence services investigating Huawei in relation to Chinese espionage activities, @volkskrant reports, citing ‘intelligence sources’ (without more details),” according to a tweet by journalist Laurens Cerulus.

"Never mind the 5G network,” says a tweet by British satirical and news magazine Private Eye. Unfortunately, you have to buy a print copy to read how “Huawei is already embedded in every British embassy throughout the world, carrying vital confidential information.”

How are other countries responding to Trump's Huawei threat? The Guardian has a roundup.


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