US suppliers have been granted the right to continue selling components to Huawei for a further 90 days, as the US government takes steps to minimise the economic fallout of the impending trade restrictions.
The US Department for Commerce said the three-month extension would “afford consumers across America the necessary time to transition away from Huawei equipment, given the persistent national security and foreign policy threat”.
In an interview with Fox Business, the commerce secretary Wilbur Ross added that the move would also give rural telecoms companies time to “wean themselves off” Huawei equipment before US suppliers are forced to drop their support for the company.
President Donald Trump had signalled over the weekend that his administration would refuse to further delay the trade ban, amid concerns about the company’s alleged ties to Beijing and with the US and China engaged in a bitter trade war.
But while Washington granted the company a three month reprieve, it also blacklisted another 46 of its affiliates. A spokesperson for the company described the move as politically motivated and unjust.
“These actions violate the basic principles of free market competition,” said the spokesperson. “They are in no one’s interests, including US companies. Attempts to suppress Huawei’s business won’t help the United States achieve technological leadership.”
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The decision to delay the date the trade ban comes into effect would not have an impact on its business, added the spokesperson. But the move is likely to be welcomed by Huawei’s American suppliers, which will be able to continue trading with the company until 18 November on the condition that the deals do not affect national security. A number of US chip makers, including Qualcomm, Intel and Micron Technology, saw their share price rise following move.
Earlier this year Huawei began developing its own operating system in expectation that the US could force Google, the developer of the Android software through which its phones operate, to stop trading with the company. Huawei has said the US sanctions could cost the company $30bn.