China has said the US administration should end “unjustified repression” against HUAWEI after the Trump administration’s decision to block the global supply of chips to the blacklisted Chinese telecommunications giant.
China’s Commerce Ministry said on Sunday that it is firmly opposed to the latest rules the United States has set against HUAWEI and will take all necessary measures to protect the rights and interests of Chinese companies.
In the statement, the same ministry urged the United States to immediately end the “wrongdoing” and, in its response to whether Beijing would retaliate against the United States, it made it clear that China will vigorously defend the legal rights of its enterprises.
Chinese Global Times source on Saturday said Beijing was ready to take a series of countermeasures against the United States, such as placing US companies on a “list of unreliable entities” and will impose controls on US companies.
The People’s Daily – the official newspaper of the ruling Chinese Communist Party – said the source also mentioned the suspension of the purchase of Boeing planes.
“China will take strong countermeasures to protect its legitimate rights” if the United States goes ahead with its plan and prevents major chip suppliers – including Taiwan-based TSMC – from selling it to HUAWEI, a indicated the source.
“TSMC” is HUAWEI’s largest chip maker and main supplier.
The Trump administration has decided to block HUAWEI’s global supply of chips after the new base went into effect on Friday, but will grant a 120-day grace period.
TSMC is HUAWEI’s largest chipmaker and main supplier and announced plans to build a US-based factory last Thursday.
The United States has not provided any guarantees to the Taiwanese firm TSMC to authorize its sales to HUAWEI, while the Taiwanese company said on Friday that it “will closely follow the changes in the export rules of the United States and that she works with an external consultant to conduct a legal study and ensure a complete understanding and interpretation of the situation.
In its press release, the Chinese Ministry of Commerce said that the United States is hiding its actions under the alleged national security problem. He also added that the United States is abusing export controls to continue to crack down on private companies in other countries.
US Secretary of State Mike Pompeo justified the new measure as protecting “the security of 5G networks and preventing HUAWEI from undermining US export controls”.
“This measure puts America first, American business first and US national security first,” a senior US Department of Commerce official told reporters on Friday.
For its part, according to Kevin Wolf, a lawyer in Washington and former official of the Ministry of Commerce, the principle seems to establish “a new and complex expansion of trade restrictions” to control Huawei.
HUAWEI found itself at the center of a battle for global technological dominance between the United States and China, whose relationships have become a little more strained in recent months due to the spread of the Coronavirus.
Currently, most chip makers rely on equipment produced by American companies, while some of the sophisticated tools needed to make chips come from companies outside the United States, such as Japan Tokyo Electron and Hitachi and Dutch company ASML, and analysts say it would be difficult to assemble a complete toolbox for manufacturing advanced semiconductors without some American equipment.
“We are concerned that this base will create uncertainty and unrest in the global semiconductor supply chain,” said John Neuffer, CEO of the semiconductor industry.
