Firmly safeguard the legitimate rights and interests of Chinese enterprises.
On May 7, according to media reports, the U.S. government has revoked the licenses of Intel, Qualcomm and other companies to export chips to Huawei.
In response, the U.S. Department of Commerce confirmed that a batch of licenses had been revoked, but did not specify which companies. Previously, Intel and Qualcomm were chip suppliers for Huawei's laptops and mobile phones, respectively. After Huawei was sanctioned by the United States in 2019, they were given special authorization to sell chips to Huawei. This move has aroused widespread attention and discussion, involving international trade, scientific and technological competition and other levels.
In response, the Ministry of Commerce said that China has taken note of relevant media reports. The US has broadened the concept of national security, politicized economic and trade issues, abused export control measures, and repeatedly imposed unreasonable sanctions and repressive measures against specific Chinese companies. China firmly opposes this.
Export chip licensing "tightened"
In 2019, the U.S. added Huawei to a trade restriction list for allegedly violating U.S. regulations. Being on the list means that Huawei's U.S. suppliers must apply for a special and difficult-to-obtain license before shipping to Huawei.
The Trump administration at the time issued one such license that allowed Intel to ship laptop-ready CPUs to Huawei starting in 2020.
In August 2022, the United States signed the CHIPS and Science Act, which provides $52 billion in subsidies to support the manufacturing and R&D of the semiconductor industry in the United States, to help the United States regain its leading position in semiconductor chip manufacturing.
Subsequently, the U.S. Department of Commerce began to introduce a series of control measures to restrict the flow of advanced chips, chip production equipment, technology and personnel to China in October 2022: In October 2023, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) issued a series of export control rules again, updating the restrictions on advanced computing chips, semiconductor manufacturing equipment and other fields: In March 2024, the United States revised the chip export control rules issued in October of the previous year, Extend export restrictions to China to laptops containing these chips.
So far, the United States has cut off some sales of chips exported to China by companies such as Nvidia, Advanced Micro Devices, AMD and Intel.
On April 11 this year, Huawei launched its first AI-enabled laptop, the MateBook X Pro, which is equipped with Intel's new "Core Ultra 9" high-performance processor, which complies with relevant restrictions and brings benefits to Intel. But it also shocked and annoyed some Republican members of the U.S. Congress, who were biased and convinced that the U.S. Commerce Department had given Huawei the green light to export the chips.
"One of the biggest mysteries in Washington, D.C., is why the Commerce Department continues to allow the shipment of U.S. technology to Huawei," Republican Rep. Mike Gallagher, chairman of a House Select Committee on Strategic Competition, said in a statement to Reuters.
Ministry of Commerce: Firmly safeguard the legitimate rights and interests of Chinese enterprises
In the opinion of relevant experts, the revocation of the license will not only affect the sales performance of American companies, but may also damage their competitiveness in the global market. At the same time, it may also trigger countermeasures from other countries and regions, further affecting the international business of US companies. "This move is not conducive to the improvement of trade relations between China and the United States, triggering a potential trade dispute." The expert said.
The Ministry of Commerce said that the U.S. restrictions on the export of purely civilian consumer chip products to China and the supply of specific Chinese companies are typical economic coercion practices, which not only violate WTO rules, but also seriously damage the interests of U.S. companies. What the US has done has seriously violated its commitments not to seek decoupling from China, not to hinder China's development, and runs counter to its statement of "accurately defining national security". China will take all necessary measures to firmly safeguard the legitimate rights and interests of Chinese enterprises.
Response to the "Spare Tire Program":
Supply chain stability is once again challenged
In response to the incident of restricting the license to export chips, on the evening of the 8th, a picture involving Huawei circulated on the Internet.
The picture shows that He Tingbo, chairman of Huawei Hisilicon Semiconductor, and Yu Chengdong, chairman of the terminal BG, issued a "Letter to Comrades-in-Arms" internally, proposing a spare tire plan for PC-side chips, which was officially turned into a regular product. HiSilicon and the terminal BG are required to do their best to bring products equipped with the "Kirin X series (tentative name)" PC platform to the market with the fastest speed and highest quality within this year.
In this regard, relevant sources said that "A Letter to Comrades-in-Arms" is fake news.
According to data from analyst agency Canalys, in the Chinese market, Huawei's share of notebook sales has increased from 2.2% in 2018 to 9.7% in 2023, replacing Dell as the third largest laptop seller and the only manufacturer in the top five to achieve growth.
At the same time, Huawei's mobile phone sales are also recovering rapidly. According to the International Data Corporation (IDC), Huawei's smartphone shipments in the first quarter increased by 110% year-on-year, and its share of the Chinese market rose to 17.0% from 8.6% in the same period last year, tying Honor for the first place in the Chinese smartphone market.
On April 30, Huawei Investment Holding Co., Ltd. disclosed its first quarter report for 2024, during which the company achieved operating income of about 178.45 billion yuan, a year-on-year increase of 36.66%; The net profit attributable to the parent company was about 19.65 billion yuan, a year-on-year increase of about 564%.
It is worth mentioning that on May 7, Huawei successfully held a global innovative product launch conference in Dubai, which is also the largest launch event held by Huawei in the world in recent years, with the largest number of new products released at one time.
Among them, Huawei released a new generation of HUAWEI MateBook X Pro, which weighs only 980 grams and is 13.5 mm thick, which is the only notebook in the world equipped with Intel ® Core ™Ultra 9 standard processor within 1kg.
Regarding this incident, relevant experts believe that this incident poses another challenge to the stability of Huawei's supply chain, and Huawei may need to readjust its procurement strategy, or increase independent research and development and production to ensure the continuous supply of its products.
In the past three years, despite severe challenges, Huawei has continued to adhere to the two-wheel drive innovation mechanism driven by science and technology and customer needs, and insisted on investing more than 10% of its annual sales revenue in R&D, and in 2023, Huawei's R&D expenditure was RMB 164.7 billion, accounting for 23.4% of its annual revenue. In the past ten years, the cumulative investment in R&D has exceeded RMB 1,110 billion. As of December 31, 2023, there were approximately 114,000 R&D employees, accounting for 55% of the total number of employees.
Written by: blog post
Editing and proofreading: blog posts
Guidance: Xin Wen
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