The US ban on Huawei has taken a new turn. President Trump today announced in a news conference that U.S. companies will be allowed to work with the Chinese manufacturer again. This is a surprising turnaround that came just weeks after the Trump administration banned Huawei calling it a major threat to U.S national security.
Trump in the G20 Osaka said “U.S. companies can sell their equipment to Huawei” without specifying much. He continued “We’re talking about equipment where there’s no great national security problem with it”. Its not clear to what extent Huawei can do business with the U.S. companies, but it will likely to be able to acquire basic components like Qualcomm chipsets and Google’s Android OS.
According to a report from Bloomberg, the current US president said
I said that’s O.K., that we will keep selling that product, these are American companies that make these products. That’s very complex, by the way. I’ve agreed to allow them to continue to sell that product so that American companies will continue.
He further shared his view on the company
Huawei is very much in play in terms of our country and in terms of intelligence and the intelligence community — we know a lot about Huawei — but I don’t want to mention that right now. I just think it’s inappropriate. We’re not making it other than what I told you… We’re going to save that for later.
Huawei has been a major player in buying equipments from US companies. Last year, the company spent around $11 billion on chipsets from Intel, Qualcomm and Micron alone. A report from Reuters said Intel and Xilinx discussed with the U.S commerce Department to ease restrictions on Huawei. Earlier this week WSJ reported that China would make the lifting of the Huawei sanctions an essential condition for any trade agreement with United States.
As for now, Huawei is still listed on the so called “Entity List” of companies that are banned from dealing with American entities by the U.S. Department of the Commerce. A formal decision is yet to be made while discussions between U.S and China are ongoing. Trump did mention that Huawei is still a security risk in the eyes of the U.S. government.
The US and the Chinese government seemed to have found a common ground in the trade war. The latest round of tariffs that were due to go into effect in the next few days have been suspend while Chinese government agreed to purchase more agricultural products from the country. Trump on the matter said
We had a very good meeting with President Xi of China, excellent, I would say excellent, as good as it was going to be. We discussed a lot of things and we’re right back on track and we’ll see what happens.
After the announcement today, Huawei may be back in business in a few days. The company reportedly stockpiled critical components before the ban in mid-May that would allow operating for up to three months. However, the losses occurred due to the ban will be irreversible. The company said its revenue will be $30 billion below estimates. Huawei was projected to take the first place in the smartphone market next year beating Samsung, but now it may take much longer.
As for the customers and fans, the news should be a relief. This means Huawei and Google may work together in the future to bring updates for its smartphones. We may also see the next Android Q in several upcoming Huawei devices.