Before Trump fired his latest salvo, there had been some expectation that he could ease restrictions on the company. Huawei, which is the world’s largest telecommunications equipment maker and a leading smartphone brand, has been on a US trade blacklist since May.
But the decision to reignite the trade war with a 10% tariff on $300 billion worth of Chinese goods from September 1 — effectively a tax on all goods from China that come into the United States — throws any respite into question.
“[T]his escalation increases the risk that Trump reneges on his pledges to save Huawei,” analysts at the Eurasia Group wrote in a note Friday morning.
Washington’s trade blacklist bars American firms from selling tech and software to Huawei unless they get a license to do so. The United States says the company is a national security concern, and claims it engages in activities that run counter to US foreign policy interests. Huawei denies that is the case, and says that none of its products pose a national security risk.
While Trump didn’t mention Huawei in any of his latest trade tweets, his tariff announcement could complicate that plan. His broadside followed an uneventful round of talks in Shanghai, where the president heard there were no concrete promises from China to purchase American agricultural products.
“Unless China restarts agricultural purchases soon, he will have little to show for a move that is deeply unpopular with China hawks,” the Eurasia Group analysts wrote, in reference to the proposed relief for Huawei. “And if Trump backs away from promises to issue licenses to Huawei’s US suppliers, the odds of negotiations breaking down and tariffs being imposed rises.”
Huawei declined to comment on Friday.
And during an earnings presentation Tuesday, Huawei Chairman Liang Hua said the company will continue to “face difficulties” in the second half of this year and next year.
The Huawei ban threatens American businesses, too. Chipmakers have asked the Trump administration to allow sales to Huawei to resume.
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