Washington Bans Licenses for American Companies to Export to Huawei

The Biden administration has announced that it will no longer provide US companies with licenses to export technology to Huawei, marking a significant move towards a total ban on the sale of American technology to the Chinese telecom giant. The commerce department has reportedly informed companies of this decision and it marks the latest in Washington’s efforts to curb Huawei’s operations. The Trump administration had already imposed restrictions on exporting American technology to Huawei in 2019 by adding the company to the “entity list.” However, the commerce department continued to grant export licenses to some companies, including Qualcomm and Intel, for technology that was not related to 5G telecom networks.

President Biden has taken a tougher stance on China in the area of cutting-edge technology, particularly in October when he imposed sweeping restrictions on providing advanced semiconductors and chipmaking equipment to Chinese groups. Alan Estevez, the head of the commerce department’s bureau of industry and security, has been leading a review of China-related policies to determine ways the administration can make it harder for the Chinese military to use US technology to develop weapons.

Martijn Rasser, a technology expert at the think-tank CNAS, says that this move by the commerce department is significant and is partly driven by Huawei’s expansion into areas such as undersea cables and cloud computing. Huawei’s operations have stabilized over the past two years, but Washington’s actions come as the company is looking to return to “business as usual” in 2023.

Industry insiders believe it’s too early to assess the impact of the latest measures on Huawei. Paul Triolo, a China tech expert at the Albright Stonebridge consultancy, says the commerce department’s action will have a major impact on US supplier revenue and that it’s partly being taken over concerns about a congressional review by the Republican-led House of Representatives.

The US is also stepping up its efforts with allies to slow China’s push to develop cutting-edge technologies, such as semiconductors used for artificial intelligence, nuclear weapons modeling, and the development of hypersonic weapons. Secretary of State Antony Blinken is preparing to travel to China next week for the first visit by a member of Biden’s cabinet. The US recently reached a deal with Japan and the Netherlands to restrict companies in those countries from exporting certain chipmaking equipment to China. The US has also imposed unilateral restrictions on American companies from exporting semiconductor manufacturing tools.