US Blacklists Huawei and Affiliates, Stocks Take a Dive

Lester Mason
May 18, 2019

China's telecom equipment giant Huawei Technologies Co.

"It's going to have...effects through the entire global telecommunications network because Huawei affiliates all over the (world) depend on US content", Wolf said.

"Huawei is the unparalleled leader in 5G". Japan, Australia and New Zealand have also effectively banned the company from 5G infrastructure projects. By some estimates, in the 5G race, Chinese firms could come to hold around 40 percent of such patents. But Washington's allies seem unwilling to follow suit.

That certainly provides some context to the issue, but it doesn't address the core point. Is Huawei a security risk that enables Beijing to spy and to steal technology?

Europe is continuing to construct 5G networking infrastructure using Huawei equipment, according to Nikkei, despite the Chinese company being effectively banned from doing business in the U.S.

Washington has so far failed to produce any hard evidence to suggest that Huawei is a national security risk, although Chinese law demands that any Middle Kingdom firm co-operate with the authorities if required.

China will definitely safeguard the legitimate rights and interests of its businesses, and Trump's executive order is not a "constructive and friendly" gesture, Foreign Ministry spokesman Lu Kang said on Thursday.

"Regardless of who, in a practical sense, owns and controls Huawei, it is clear that the employees do not".

The Reuters News Agency reported this story.

Canada is still weighing up its decision over Huawei.

Commerce Secretary Wilbur Ross said Trump had given his department 150 days to establish a process to screen US companies' purchases of equipment from Huawei and other equipment providers with which officials have concerns.

Ross dodged questions about whether the new moves against Huawei could lead to a negotiation with the company - or the Chinese government.

"No part of the communist Chinese state is ultimately able to operate free of the control exercised by its Communist Party leadership", Dearlove wrote yesterday.

Wang Yanhui, secretary-general of the Mobile China Alliance, said, "Huawei has also been preparing for such a situation for some time and has hoarded chips to handle a worst-case scenario". Either way, the risk is real enough, especially with a government in Beijing that encourages theft of intellectual property as a strategy for modernization.

Doubtless there'll be more to come in the Huawei kerfuffle, and El Reg will dish up another pile of it next week if this pace continues. These analysts say the threat from China is real, but that global telecommunications are almost impossible to control and the best defence against espionage is not an executive order but old-fashioned vigilance among those who use computers and other technology.

China's Foreign Ministry confirmed that prosecutors charged Michael Kovrig with "gathering state secrets and intelligence for overseas forces" and Michael Spavor with "stealing and providing state secrets to overseas forces".

Foreign ministry spokesman Lu Kang said: 'We urge the United States to stop this practice and instead create better conditions for business co-operation'.

All major US wireless carriers and internet providers had already sworn off Chinese-made equipment after a 2012 report by the House Intelligence Committee said Huawei and ZTE, China's No. 2 telecoms equipment company, should be excluded as enablers of Beijing-directed espionage.

"We hope and expect that any decision on Huawei's participation in Britain's build-out of 5G networks will be based on solid evidence, rather than on unfounded speculation and groundless accusations", it said.

The U.S. government has long insisted that equipment from Chinese suppliers, including Huawei, poses an espionage threat.

Other reports by Iphone Fresh

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