China announced on Friday the creation of a blacklist of "unreliable" foreign companies, in response to US ban against the Chinese giant company Huawei. Analysts say this signal the full swing of the trade war between the two powers and more will come soon.
The Blacklist creation seems a response to the offensive of the Trump administration against Huawei. Huawei depends on American-made electronic chips to equip its mobile phones. Furthermore, their Android operating system that came from Google is very important, and all of these are said to affect Huawei severely, and its very existence is at stake now.
The United States alleges that Huawei has close ties to the ruling Chinese Communist Party and that it is, in fact, a Trojan horse that serves the interests of Beijing's intelligence services. Huawei, the second largest producer of smartphones, and a leader in the development of next-generation 5G networks, strongly denies these accusations and said that they are not given enough chance to defend themselves in court before the US ban happened.
In connection with this, China's blacklist is said to do the right thing and ban foreign companies, organizations, and individuals that do not respect market norms, that move away from the spirit of a contract, that impose embargoes or cease supplying Chinese companies for non-commercial reasons.
China said the blacklist, which is called the "list of unreliable entities," will be designed to protect the international economy and the multilateral trading system against unilateralism and trade protectionism. The concrete details of how the list of entities will work in practice are not yet published.
The creation of China's blacklist came a day before Beijing apply on Saturday an increase in tariffs on US products worth 60 billion dollars. This again is in retaliation for the rates of 200 billion dollars that the US government imposed on Asia.
Meanwhile, adding more fuel to the trade war is Huawei as they have asked its US research and development workers to leave the headquarters of Shenzhen, China, and return to their country. In addition, Huawei has ordered workers at its headquarters to cancel technical meetings with their US contacts and have zero to limited contact to their departments in the United States.
