Trump's explanation why he blocked Huawei from U.S. supply chain will have you shaking your head



Huawei has not had a good week. It started exactly one week ago today when President Donald Trump used an executive order to declare a national emergency against U.S.technology. At the same time, Huawei and 68 affiliates were placed on the Commerce Department's Bureau of Industry and Security (BIS) Entity List. This prevents Huawei from obtaining U.S. parts and components unless a license is issued by the U.S. Government.

After Google cut ties with Huawei last weekend, Trump gave Huawei a little reprieve on Monday. Huawei was given a 90-day temporary license allowing it to source parts from the U.S. "necessary to provide service and support, including software updates or patches to existing Huawei handsets." Google followed by promising to update existing Huawei phones through August 19th. But the lifesaver tossed by Trump at a floundering Huawei doesn't help the manufacturer when it comes to future devices, such as the Mate 30 series expected later this year. And British chip developer ARM holdings might have nailed the coffin shut when it announced yesterday that it would cut ties with Huawei. Sure, the company develops its own chips, but it uses U.S. software to do so, and Huawei's Kirin SoCs use ARM's architecture. It turns out that ARM's designs contain "US original technology."

So the future of the company that was set to become the largest smartphone manufacturer in the world next year is up in the air. A number of times last week we wondered whether the real reason for Huawei's placement on the Entity List was to use the company as leverage in the U.S.-China trade war. And that was confirmed today by none other than President Donald Trump himself. A video posted by C-SPAN (via The Verge) shows remarks Trump made today to a reporter after announcing a $16 billion aid package for farmers affected by the trade war.

When a reporter asked the president about Huawei, he first says, "Huawei is something that’s very dangerous." He adds that "from a military standpoint, it’s very dangerous." He goes on to say that the company could be used included in a trade agreement with China. "So it’s possible that Huawei even would be included in some kind of a trade deal. If we made a deal, I could imagine Huawei being possibly included in some form, some part of a trade deal." The reporter asks the president how that would look and Trump replied, "It would look very good for us." But Trump then changes his tune again. "Oh, it’s too early to say. We’re just very concerned about Huawei from a security standpoint."

There is still hope for Huawei if both countries can reach a trade agreement


So it turns out that Trump has two reasons for punishing Huawei. One is the security issue and the second, as we surmised, is to use the company as a bargaining chip in the trade war. This technically could be good news for Huawei because if both sides agree to a new trade deal, the company could be off the hook. But then again, who knows what is in Trump's mind? This is the man who announced in July 2017 that Apple CEO Tim Cook had told him that Apple was going to build in the states "three big plants, beautiful plants." Apple had no idea what Trump was talking about.

Another, perhaps more relevant example occurred last year when fellow U.S. national security threat ZTE was crippled by an Export Ban that prevented the company from sourcing parts from the U.S. The same man who continually threatened China during his presidential campaign for stealing jobs from the U.S. sent a tweet complaining that the Commerce Department ban was resulting in "Too many jobs in China lost." Trump demanded that the Commerce Department work out a deal with ZTE and that is exactly what happened.

Huawei, of course, hopes that it is merely a pawn in the trade war and that once a deal is reached between the two countries, it can return to the path that had it surpassing Samsung at the top of the global smartphone industry next year.

You can watch the comments on the video at the top of the story. The relevant part starts about 41 minutes into the video.

FEATURED VIDEO

31 Comments

1. Dr.Phil

Posts: 2451; Member since: Feb 14, 2011

FYI Democrats also support targeting Huawei. Here’s an article about a California Dem supporting the measures: https://thehill.com/hilltv/rising/444967-progressive-rep-says-targeted-sanctions-on-huawei-are-reasonable

2. Dr.Phil

Posts: 2451; Member since: Feb 14, 2011

“Huawei & ZTE pose a clear & alarming threat to our national security & the development of 5G, & should be banned. We now have to draw a line: foreign adversaries must be blocked from any involvement with our critical infrastructure & communications networks.” -Richard Blumenthal

5. AxelFoley unregistered

I think the subject (and title) of the article has more to do with the explanation given, eg: leverage for the trade war.

10. Dr.Phil

Posts: 2451; Member since: Feb 14, 2011

Right and my point is that the conclusion assumes that once a trade agreement is reached that the Huawei ban will be lifted, but there's bipartisan support to actually keep the ban going no matter if there is a trade agreement or not. Considering that Trump potentially only has another year and a half in office means that the next administration could reinstitute the ban if he gets rid of it.

28. oldskool50 unregistered

Or the next administration can lift the ban even if Trump doesn't. It's solely for political reasons, even if "some" democrats were against it. If you go and read or view the videos on YT that show the real reasons. It's 70% politics and tryign to get an edge in the war and 30% for security. Facts are that Huawei has not been officially in any court been found to have spied on anyone using their hardware. PERIOD. That bogus crap they mentioned about T-mobile, Apple has stolen far and away more IP than that. Microsoft has stolen far and away more IP than that.

3. Tziggy14

Posts: 624; Member since: Sep 02, 2014

It's too late even if Huawei to come back even if the two countries reached a deal. The US government had gone all out on bullying and pressure tactics to actively damage Huawei's brand.

13. Arch_Fiend

Posts: 3951; Member since: Oct 03, 2015

People just assume that political figures with more information on things than us just make stupid discussion and have no clue what they are doing, they don't realize how much info the gov has on things that we don't know about and decisions to do certain things are made for a reason.

4. warrenellis93

Posts: 550; Member since: Jul 21, 2011

Too bad the writer of this article is too dumb to know that china has been manipulating our businesses for years

18. vikingsfootball09

Posts: 112; Member since: Oct 02, 2013

the same way the u.s. government is manipulating our allies and the rest of the world for its own best interest... like i said, a cheating husband accusing his wife of cheating. lol

29. oldskool50 unregistered

Not that I don't believe you, I just want you to show proof of that?! I guess the US is no different? Don't all gov't try to manipulate others? To point a finger at one, as if no one else is any different is biased an wrong. But here is a fact for you, the reason why China was given a so-called by trump very laxed trade deal is, because China absorbed TRILLIONS of US debt on behalf of the US Gov't. https://www.investopedia.com/articles/investing/080615/china-owns-us-debt-how-much.asp

30. oldskool50 unregistered

So quoting from the article: "Why China Owns So Much US Debt There are two main economic reasons Chinese lenders bought up so many U.S. Treasuries. The first and most important is that China wants its own currency, the yuan, pegged to the dollar. This has been common practice for many countries ever since the Bretton Woods Conference in 1944. A dollar-pegged yuan helps keep down the cost of Chinese exports, which the Chinese government believes makes it stronger in international markets. This also reduces the purchasing power of Chinese earners. Dollar-pegging adds stability to the yuan, since the dollar is still seen as one of the safest currencies in the world. This is the second reason the Chinese want Treasurys; they are essentially redeemable in dollars. China drew some headlines in 2013 and 2014 for buying up a lot gold to store in its bank vaults, but the real safety net for the yuan is the worldwide belief in the dollar." China did this, do the Yuan can be more balanced vs the US Dollar, which makes China exports cheaper. Which means thinks like phone and electronics that come from there, are more reasonably priced. If CHina has never done this, imagaine what good like clothing, phones, computers and more would cost. China absorb this debt to be a partner to the US Trade. The US decides to thank them by basically spitting in their face. The US treasury gets zero dollars from exports. What they do get is we end up paying a higher retail price, which means we pay not a higher sales tax, but more tax at checkout and the feds benefit from companies havign to pay more taxes on the taxes they receive from sales. Trump lied and many fools just went along. This claimed misisng money the US Treasury doesn't get, they were never gettign to begin with because VAT Taxes do not go directly to any Government. if the US Gov't wants direct money from exports, they would have to put a separate Gov't tax on those goods, just liek they put on gas, alcohol, soda and other goods we buy.

6. TS020

Posts: 50; Member since: Feb 16, 2019

Alan's explanation why he uses clickbait titles will have you shaking your head FTFY

7. irwan92

Posts: 47; Member since: Feb 12, 2013

Huawei being blocked due to 5G technology. Its not about spying but its about licensing the technology. Huawei is currently leading in 5G. So if huawei's 5G is implemented, the u.s need to pay for it like Lte technology, there's royalty.. Trump don't want u.s 's money to bleed. Remember his moto? To make America great again. Thats it. He is a business man. What he thinks is just money. There is a news about toyota. Trump said toyota is a treat to usa. What??? Its the same situation with huawei. He uses his power to ban outside companies that can out number America's company .

19. vikingsfootball09

Posts: 112; Member since: Oct 02, 2013

and that is also why Trump wants apple to build its own manufacturing plants in the u.s. and manufacture its own devices in the u.s.

8. djcody

Posts: 228; Member since: Apr 17, 2013

So where is that shaking head? Few simple, straight words? That's it? I probably should go in shaking mode now.

16. dimas

Posts: 3382; Member since: Jul 22, 2014

Clickbait, always clickbait.

26. BuffaloSouce unregistered

And you dumbassess fall for it every time then complain about it

9. kennybenny

Posts: 218; Member since: Apr 10, 2017

I knew the title was typed longer to get more clicks on purpose....... Ditto!

11. rossy

Posts: 42; Member since: Aug 23, 2013

Two things can be true at the same time - Huawei is a security risk and a bargaining chip if this what it takes. The compromise is ban in the US but allow component sourcing by the US firms. Trump wants to make a deal and he will use the leverage he has to get the best deal for the US he can. Why is it so difficult to grasp?

20. vikingsfootball09

Posts: 112; Member since: Oct 02, 2013

so Trump is basically playing Apples game? no wonder Apple can get away with having the u.s. court back them up.

12. Guseinguliev

Posts: 118; Member since: Mar 04, 2019

this time I agree with the Tramp

14. dimas

Posts: 3382; Member since: Jul 22, 2014

For years, chinese manufacturers have been infringing patents and royalties with iphone/android clones. They've pirated more than anybody can imagine and huawei is no exception with their start-ups. Since they are always patriotic, anti-american and edgy promoting their products, I dare huawei designers to create their own technologies from scratch. You don't like what US is doing? Don't use their technology. No more gorilla chest pumping from huawei because they're already shot by the hunter, limb per limb. Just do the US law dance huawei and you'll be back in business.

15. Shubham412302

Posts: 581; Member since: Nov 09, 2011

How naive can PhoneArena be. Its obvious that they targeted Huawei only due to trade and has nothing to do with privacy.

21. vikingsfootball09

Posts: 112; Member since: Oct 02, 2013

the u.s.government have always had its own sham...a bigger sham with Trump.

17. hamaidx

Posts: 99; Member since: Apr 28, 2015

Its a shame that US has lowered to such an extent that it wants to BAN a org cause of its growth... talk about effin American Dream. C'mon man.. grow some balls... you're just an hype and would always create hype for no real s**t!

23. AxelFoley unregistered

Is it also a shame that China has banned some US companies...for example, ummmm....Google?

22. AlienKiss

Posts: 200; Member since: May 21, 2019

Why do you people care so much about a wannabe copy/paste brand (if you're not chinese if course)? Do you even dare to say you know what's going on behind what is being displayed? What scripts are running or not? You can't even root their phones because they don't want it! I was never a fan and I never will be. Only high-end flagships from Samsung or Sony for me! Tough luck copy/paste! Android is all about open-source freedom, not your communist digital prison! Now f off!

24. P20prouser

Posts: 44; Member since: Oct 10, 2018

If you cant explain and fight with ethic. Just say the world '' its dangerous'', coming from a stand point of a true manipulator country.

25. Droid1

Posts: 30; Member since: Oct 06, 2017

If the Democrats want the ban too, you know it's more than just Trump.

27. xq10xa

Posts: 810; Member since: Dec 07, 2010

PA's Alan Friedman's headlines got me shaking my head. Clickbait much?

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