Despite landing on a White House blacklist, companies in the U.S. will be able to sell American made products to Huawei, the Chinese telecommunications company.
According to media reports, U.S. Commerce Secretary Wilbur Ross said the U.S. will give companies licenses to do business with the Chinese company granted it doesn't pose a threat to national security.
Earlier this year President Donald Trump placed Huawei on a blacklist, citing national security concerns, that prevented most businesses in the U.S. from using its products or services. It was a big blow to Huawei, which had just started to steal market share and become a formidable player in the smartphone market outside of China.
With China and the U.S. embroiled in a trade war that has been hurting both countries, President Trump tried in late June to ease the tension by announcing American companies can sell products to Huawei.
While that was welcome news, particularly to semiconductor companies in the U.S., it also sparked confusion because it's not clear what is deemed a national security threat and what isn't. After Huawei was placed on the list of entities government agencies and U.S. companies couldn't do business with the semiconductor industry urged the government to make exceptions so those companies can sell items that won't put national security at risk.
U.S. Government Won't Purchase Parts, Components from Huawei
During a Commerce Department conference, Ross said Huawei will remain blacklisted but that there will be some licensing approvals for U.S. companies. “To implement the president’s G20 summit directive two weeks ago, Commerce will issue licenses where there is no threat to U.S. national security,” Ross was quoted as saying. “Within those confines, we will try to make sure that we don’t just transfer revenue from the U.S. to foreign firms."
The Commerce Secretary went on to note that while the Chinese telecom company remains on the list of U.S. enemies the U.S. government won't buy any parts or components from Huawei but that the private sector may be able to. “In respect to the private market, I call it general merchandise, we’ve opened the door and relaxed a bit the licensing requirements for the commerce department, where there are no national security influences or consequences,” he told reporters.
The progress made with Huawei is aimed at pushing forward with trade talks with China but the U.S. government could change their mind if the discussions hit new roadblocks.