The Biden administration has not believed its word, and still adopts a policy of containment and suppression against China, and recently hit Huawei hard, revoking the licenses of some local companies in the United States to export Huawei-related cutting-edge chips, which has a big impact on Huawei's artificial intelligence computer manufacturing. In the face of Huawei's breakthrough of the hegemony of the United States in multiple technical directions, the Biden administration could not hold on, and resorted to shady tactics to openly target Huawei. The next day, China's response was swift and forceful, saying that it would take all necessary measures to firmly safeguard the legitimate rights and interests of Chinese companies. Against the backdrop of high U.S. debt, the U.S. is most worried about China's continued reduction and sale of U.S. Treasury bonds. However, there is no such good thing in the world, how can there be a reason to urge people to borrow money while sanctioning? The United States has completely miscalculated.
On May 7, the Biden administration further tightened export restrictions on Huawei, revoking the licenses of U.S. chip companies Qualcomm and Intel Corp. to sell semiconductors to Huawei.
In recent years, the United States has continued to interfere in the Sino-US competition in the high-tech field, stirring up the normal development of the global semiconductor industry every now and then, in order to hinder the progress of China's chip technology, the Biden administration has promulgated a series of bills and strict export control measures, but its own companies have suffered serious damage. Qualcomm reported a sharp decline in operating income, net profit and mobile phone chip business in last year's quarterly financial report, and Intel's first fiscal quarter of 2024 was also far below market expectations.
Why is the Biden administration so afraid of Huawei? Why are U.S. companies losing so much? It's all because Huawei has the strength to break the U.S. technological hegemony, which is what the Biden administration is most worried about at this stage.
The first is a challenge to US hegemony in the field of communications. In terms of the number of 5G patents, Huawei ranks first in the total number of 5G patents, followed by Qualcomm, which has invested more than 977.3 billion yuan as R&D funds in the past decade, giving birth to cutting-edge technologies such as satellite communications and Starlight technology. Qualcomm can only relive the "glory" of the past 3G and 4G eras, due to the high patent fees, which has caused the "public anger" of global customers, and caught up with the arrival of the 5G era, so the United States' communication hegemony has been shaken by Huawei.
Second, it is a breakthrough in the field of chips. In 2018, after Huawei's mobile phone sales surpassed Apple's, the U.S. government began to target Huawei, playing a set of combination punches, restricting Huawei's access to high-performance chips from American companies, in an attempt to stabilize its position with chip blockade. However, the good times did not last long, marked by Raimondo's visit to China and Huawei's release of a new smartphone equipped with Kirin 9000S chip, the domestic chip industry chain successfully "broke through".
In doing so, the United States will certainly lose more than it gains. It is worth mentioning that although Raimondo smeared Huawei everywhere at the hearing of the House Ways and Means Committee, threatening that "national interests are higher than business interests", and said that she wakes up every morning thinking about how to "restrict Huawei's access to advanced American technology", she also did not mention that it is mainly to restrict Qualcomm and Intel's license revocation of export chips, and it seems that there is still a delicate relationship between the government and enterprises. On the one hand, the U.S. government feels that "national interests are higher than commercial interests," and it can even abandon commercial interests to a certain extent and give way to so-called "national interests," but two problems arise here.
First, U.S. companies are not happy. According to Republican Rep. McCaul, chairman of the House Foreign Affairs Committee, "this move prevents Intel and Qualcomm from selling any chips to Huawei", and Huawei, as a major customer of these two companies, uses Intel's latest laptop MateBook X Pro, which is destined to incur hundreds of millions of dollars in losses in the short term once exports are banned. In July last year, Qualcomm, Intel and Nvidia, the three major American semiconductor giants, lobbied the White House to hope that the Biden administration would not continue to restrict the sale of chips to the Chinese market. According to relevant data, China's semiconductor purchases in 2022 will be $180 billion, accounting for more than one-third of the world's total, and if the U.S. government insists on blocking the connection with the Chinese market, it may also damage innovation in the semiconductor field in the United States.
Second, are the actions taken by the Biden administration based on the so-called "national interest" really in line with the national interest of the United States? The "Inflation Reduction Act" and "Chips and Science Act" introduced by the Biden administration over the years are all aimed at "bringing chip production back to the United States", but some arbitrary meanings are sometimes too broad and vague, even if the "small courtyard and high wall" policy claims that the chip industry in Sino-US trade has "no impact", but it is certain to generalize the concept of national security and slander China for "stealing American technology". It can be seen that Raimondo's so-called "national interests" are nothing more than artificially created illusory national interests, which are all clumsy excuses for sanctioning Huawei and containing China.
Moreover, in the face of the unreasonable containment and provocation of the United States, China's countermeasures are also on the way. In response to the Biden administration's move to revoke the license the next day, a spokesperson for the Ministry of Commerce made it clear that "the United States has generalized 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. "As far as the United States is concerned, if it wants to fight, it will have to hit seven inches, and it will hurt the Biden administration, so that their attitude towards China will be softened again, and this seven inches is the expanding US debt. On May 7, the State Administration of Foreign Exchange updated the official reserve assets, statistics showed that as of the end of April 2024, China's foreign exchange reserves were US$3,200.8 billion, down US$44.8 billion from the end of March, while gold reserves increased for the 18th consecutive month, reaching 72.8 million ounces, worth about US$167.957 billion.
It can be seen that for China, there are many ways to counter the restless United States, and seizing the "seven inches" of reducing the holdings of US Treasury bonds will have an immediate effect. Now that the U.S. debt is nearly $35 trillion, as long as the U.S. is not honest and manipulates economic, trade, and technological issues, China can continue to sell U.S. bonds, and continue to promote "de-dollarization" and use local currency for settlement in international transactions. It is believed that in the near future, the United States will again bow its arrogant head in this round of struggle and grovel and send personnel to China to "beg for mercy."