Huawei has responded to new U.S. restrictions

In its first official response to the actions of the administration trump restricting access to the global supply of chips, Huawei Technologies has called the move “unjustified”, adding that it will have an impact on the company’s business.

Chairman of the Board of Directors of Huawei Guo Ping said at a global analyst summit in Shenzhen, the company that “because of problems encountered over the past year, helped us to become stronger, we are confident that we will soon find a solution”. The company is still evaluating the impact of the new restrictions and “survival currently is the key word for Huawei,” said Guo at the subsequent session of questions and answers.

Comments received in response to the actions of the administration trump which forbade any semiconductor manufacturer, using American equipment, to supply products to Huawei without the permission of the US government.

the New export rules, which came into force on Friday, but with a 120-day grace period means that even non-U.S. chip manufacturers that use American technology of making chips will need to apply for a license before sending chips to Huawei or its 114 subsidiaries, including the company by designing chip HiSilicon.

This step again puts Huawei into the center of the U.S. plan for preventing technological dominance of China, as the administration trump and lawmakers expressed concern that America’s dependence on China in critical technology can jeopardize the country’s national security.

In an official statement released at the summit on Monday, Huawei said that “strongly opposed” the new restrictions and “holds his comprehensive study”.

“This decision was arbitrary and destructive and threatens to undermine the entire industry worldwide — said in a statement. To attack leading company from another country, the US government has deliberately turned away from the interests of customers and consumers Huawei. This contradicts the assertion of the US government that it is motivated by network security.”

the Company said that the decision of the U.S. government affect not only Huawei, but will have a major impact on many global industries and will eventually damage the interests of the United States: “In the long term it will damage trust and cooperation in the global semiconductor industry, from which depend many industries, increasing conflicts and casualties in these industries”.

it is Expected that the new restrictions would directly affect TSMC, the world’s largest contract chipmaker and a key supplier Huawei. TSMC announced last Thursday that it will build a plant for the production of chips worth $12 billion in Arizona, with the support of the U.S. government, and on Friday he added that “closely monitors the changes of US exports”. However, the Taiwanese company said Monday that reports of the suspension of the execution of new orders from Huawei because of the new rules are “market rumours”.

Huawei is in anticipation of new restrictions gradually shifts the production of chips, developed in-house, from TSMC to the Chinese company Semiconductor Manufacturing International Corp (SMIC), located in Shanghai, according to a report by Reuters last month.

After the announcement of Washington’s new restrictions state funds China has also invested $2,25 billion in the company SMIC is the largest foundry for the production of semiconductor devices in mainland China.

However, the new licensing rules will apply to SMIC, as it relies on production equipment USA for the manufacture of silicon wafers. According to one analyst, the new rules administracii trump is likely to have a significant impact on the research and development of Huawei in the field of chips.

“In the short term, Huawei will increase its efforts in procurement in order to ensure that as many of the components needed for the production of its mobile phones and base stations as long as possible, said Jia Mo, an analyst at research firm Canalys. — However, after four months of research and development of Huawei chips will be heavily affected and it will affect its main activities, such as designing and manufacturing of base stations 5G and hardware products, including smartphones”.

Huawei Income in the first quarter of this year increased by 1.4% year on year, despite the global pandemic coronavirus and ongoing sanctions from the United States, about a year after it was included in the list of legal entities of the United States, which has the effect of prohibiting telecommunications giant to buy parts and components from American companies without the permission of the U.S. government.

According to Jia, the continued survival of the company was due to the fact that for nearly a year before making any trade in the American “black list” Huawei has accumulated a critical American components, and has also shifted the focus to the domestic market.

“On the domestic market, Huawei has gradually become inseparable from China’s brand, which not only improved the company’s image, but made so that its high quality products have gained an amazing market share in China,” said Jia.

the Expert believes that in connection with the recent restrictions Huawei is likely to accelerate its shift to the domestic market, while the vendor continues to lose share of the foreign market due to restrictions on the use of apps and Google services that most foreign of Android users rely to a large extent.