After blacklisting Huawei on national security concerns the competition for global dominance between the United States and China had gone to a new level, with potentially severe implications on global tech and economic performance as a whole. US Huawei ban could have long term impact?

Even though the us huawei ban declined to acknowledge any links to the ongoing trade dispute between the two largest economies, the bottom line is China is viewed as a serious threat and the move was aimed at preventing Beijing from using Chinese companies to spy on the US.

Is US Huawei ban the end of global tech?

Companies like Alphabet had been forced to cut ties with the Chinese phone maker and telecoms equipment provider, with strong implications on consumers outside China, considering that Huawei is currently the second largest maker of smartphones relying heavily on the Android OS.

US companies are now banned from selling critical tech to Huawei and they are required to get a government license that operates under an explicit “presumption of denial” policy. As the Chinese companies races to become a primary builder of the high-speed 5G network, the US move is being interpreted as an unprecedented attack on Huawei’s global ambitions.

US Huawei ban
Could the Huawei Ban Have Long-Term Implications on the US

US Huawei ban

Although financial markets did not respond in an aggressive fashion, since the latest news point towards an easing tension between the two economic superpowers, the conflict had escalated unexpectedly in the past, raising concerns about any short-term positive resolution in US Huawei ban.

People trading with FINQ.com saw the US stock market back to record levels in the last few days as Donald Trump announced a meeting with his counterpart Xi Jinping at the Tokyo G20 meeting, which will take place at the end of June US Huawei ban.

Combined with support from the latest central banks, which had reiterated their intentions to ease monetary policy and US Huawei ban, the financial community ignores at the present the potentially-damaging implications of a long-term trade war.

Chipmakers Meeting

Chipmakers from the US had been reportedly quietly lobbying for ease of the Huawei ban during a Commerce Department meeting held in late May. Huawei spent more than $70 billion on components in 2018, out of which $11 billion went to companies like Qualcomm, Intel, and Micron Technologies. 

If the conflict between the two largest economies won’t ease and the US Huawei banwill remain in place for a longer period, companies will be forced to adapt and reshape their business activities. The US President had cheered several times companies are moving out of China, but will they want to lose one of their biggest buyers just for political interests?

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