China's Commerce Ministry warned the United States about imposing restrictions against Chinese tech giant Huawei. The Ministry claimed that as a response, it would impose necessary measures if Huawei would be disallowed to use American technology. It also manifested that the practice is an abuse of state power and violates market principles.
Last Sunday, an unidentified spokesperson posted a statement on the Ministry's website noting that the regulations imposed by the US against Huawei are a threat to the security of the global industrial and supply chain. The US allegedly uses the threat against national security to destabilize Huawei's operations and is an abuse in export control measures.
The statement then claimed that China would take measures to safeguard the legitimate rights and interests of its companies that deal with foreign entities.
A researcher with the Chinese Academy of International Trade and Economic Cooperation Mei Xinyu claimed that the newly established restrictions would escalate the tensions between China and the US. He noted that Huawei has gained a competitive advantage over the US in the information and communication technology sector and that the move would jeopardize its position.
The Ministry further alleged that the US government is ignoring the basic rules of international economics and trade. The statement read that the said restrictions pose a severe threat to the safety of global industrial and supply chains. In a report, Boston Consulting Group noted that if the US government's imposition of further restrictions against Huawei also endangers its position in the market.
The established rules by the US Commerce Department provided that foreign semiconductor makers that use American technology must obtain a US license before selling products to Huawei. At present, the chip design and manufacturing equipment that the Chinese tech companies like Huawei are mostly US-made. One of the companies that provide such products and services to Huawei is HiSilicon.
The company designs chipsets used in wireless base stations and smartphones such as those produced by Huawei. The US Commerce Department allowed a 120-day grace period of chips already in production to be utilized by Huawei.
According to the US Commerce Secretary Wilbur Ross, Washington wants to prevent the Chinese tech giant from acquiring American technology through semiconductors manufactured by other foreign entities. At present, Huawei is the leading maker of network equipment and smartphones and remains to be at the centre of a tech war between China and the US.