The Chinese telecommunications supplier is affected by US sanctions.
(Photo: dpa)
san francisco The situation of the controversial network supplier Huawei from China is coming to a head. The US government wants to deny the group any access to suppliers from the USA. The “Financial Times” as well as the news agencies Bloomberg and Reuters reported that exemptions, which have been granted so far despite strict sanctions, will no longer be granted in the future.
Huawei plays an important role in the expansion of mobile communications. The company was considered a leader in the 5G real-time network. In Germany, all three network operators, Deutsche Telekom, Vodafone and Telefónica (O2 brand) use the Chinese technology. Sales by US firms to Huawei have been restricted for four years since former President Donald Trump put the Shenzhen-based company on the US entity list over national security concerns. Since then, US suppliers have required government approval to sell to the telecom giant. The media reported, citing insiders, that these licenses should no longer be issued in the future, thus preventing any deliveries of components.
Huawei tries to become as independent as possible from US suppliers. However, the company is still dependent on companies such as Intel or Qualcomm in many areas. US companies could now be forced to end their business relationship with the Chinese. Both companies’ shares fell slightly in after-hours trading after the reports were released.
A spokesman for the Department of Commerce told Reuters that officials are “continuously assessing our policies and regulations” but would not comment on talks with specific companies. Huawei and Qualcomm declined to comment.
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Huawei initially did not comment on the reports. In December, top manager Eric Xu said: “The US restrictions are now our new normal.” The company has learned how to deal with the situation. In December, Huawei reported its total revenue at $91.53 billion for the year, down only slightly from 2021, when U.S. sanctions caused revenue to fall by nearly a third. “In 2022, we successfully got out of crisis mode,” Xu said.
China has by far the world’s largest mobile communications market. There are about as many mobile phone masts in the People’s Republic as in the rest of the world combined. Huawei continues to do very good business in its home country and supplies all network operators with extensive equipment.
Huawei is also viewed critically in Europe, but only a few countries have completely banned the use of Huawei equipment. In Germany, Huawei equipment must undergo a security check. Nevertheless, all major network operators continue to rely on Chinese technology for 5G expansion.
At the end of February, the world’s largest mobile communications trade fair, the MWC, will take place in Barcelona. Huawei is planning the biggest appearance in the company’s history to advertise to its customers globally. “This will be the biggest year for Huawei,” a company spokesman recently announced.
More: Network expansion is too slow: Mobile operators must expect sanctions