Huawei Calls Latest US Export Measures ‘Arbitrary And Pernicious’

Huawei CeBIT 2017

Telecoms equipment giant says its survival is at stake with regulatory changes that would cut off its access to semiconductors manufactured outside the US

Huawei has said new export controls planned by the US threaten its survival, and labelled the measures “arbitrary and pernicious”.

The company added that it expects the measures to affect the viability of existing networks around the world.

The US Commerce Department last week said it plans to institute changes to the country’s Direct Product Rule in order to cut off Huawei’s access to semiconductors.

“We expect that our business will inevitably be affected,” said company chairman Guo Ping at the firm’s annual global analyst summit on Monday.

huawei network‘Survival’

“We will try all we can to seek a solution,” he said.  “Survival is the key word for us at present.”

Guo said Huawei is committed to complying with US rules and regulations and said the company was driving more research and building up more inventory in response to the US’ moves.

The US added Huawei to its “entity list” export blacklist in May 2019 on national security grounds. That move barred US companies from doing business with the firm, but Huawei has still been able to buy semiconductors from companies outside the US, such as Taiwan’s TSMC.

The changes are expected to require TSMC and other manufacturers that use US-made equipment and software to obtain a licence before selling certain types of semiconductors to Huawei.  The Commerce Department said it would “narrowly and strategically target Huawei’s acquisition of semiconductors”.

The Nikkei reported that in response TSMC had immediately ceased taking new orders from Huawei.  TSMC declined to confirm the report.

Huawei said the US’ latest move was “arbitrary and pernicious”, adding that it threatened to “undermine” the global semiconductor  industry.

Trade war

“Huawei categorically opposes the amendments made by the US Department of Commerce to its foreign direct product rule that target Huawei specifically,” the company said in a statement.

Last year’s addition to the “entity list” saw Huawei miss its revenue target by $12 billion (£10bn), but the company said the latest change would have a significantly bigger impact.

The company said it expects the new rule to affect the maintenance and operation of networks work hundreds of bilions of dollars in more than 170 countries.

“To attack a leading company from another country, the US government has intentionally turned its back on the interests of Huawei’s customers and consumers,” it added.  “This goes against the US government’s claim that it is motivated by network security.”

Richard Yu, head of Huawei’s consumer electronics unit, wrote on WeChat that the US was defending its “technology hegemony” and that the national security reasons given were “merely an excuse”.

The US and China have been locked in a bitter trade war for months that has grown more bitter with recriminations over the origins of the novel coronavirus.