Zhi DongXi (public number: zhidxcom)
Compile the | Jiannen
Edit | Sing
According to the US media "Washington Post" reported on September 22, last week, the top level of the US government discussed the issue of "whether to include glory in the list of entities of the US Department of Commerce", and finally fell into disagreement. Officials at the Pentagon and the Department of Energy support the inclusion of Glory on the entity list, while the Commerce Department and State Department oppose it.
This disagreement suggests that the debate over how to weigh the pros and cons of doing business with Chinese tech companies, which existed in the Trump era, has persisted since Biden took office. According to people familiar with the matter, if the disagreement is not resolved, it may be decided by US President Biden.
Prior to this, more than a dozen U.S. lawmakers believed that Huawei's sale of Honor constituted "evasion of export controls" and asked the Commerce Department to include Honor in the entity list.
On Tuesday, Alan Estevez, the Commerce Department's undersecretary for industry and security, promised that if he is successfully elected, Honor will be reviewed to see if Huawei is using spin-off brands as a means to minimize or circumvent sanctions.
Alan Estevez, deputy secretary of the U.S. Department of Commerce
In August, more than a dozen Republican lawmakers in the United States sent a letter to Commerce Secretary Gina Raimondo urging her to add Glory to the entity list, saying Huawei's sale of the business unit constituted "evasion of export controls."
Last week, senior officials at the Commerce Department, the State Department, the Department of Energy and the Pentagon had a discussion about whether glory would be included in the commerce department's entity list, but they could not agree on whether glory would pose a threat to U.S. national security.
Officials at the Pentagon and the Department of Energy support the inclusion of Glory on the entity list, while officials at the Commerce Department and State Department oppose the move, according to people familiar with the matter. If the four departments cannot agree on the issue, the issue will escalate to cabinet level for discussion; if the issue remains inconclusive, IT will be decided by US President Joe Biden.
Commerce Department officials declined to comment on whether Glory would be added to the entity list, saying only that the Commerce Department and other agencies would constantly review a range of factors, including the "risk of technology transfer," namely "the risk that the nominated company is or will be shipping U.S. technology illegally to sanctioned entities."
Amid the stalemate, the U.S. Senate Committee on Tuesday nominated Alan Estevez, a former Pentagon official, as deputy secretary of commerce for industry and security, which oversees the entity list.
Alan Estevez promised that if he is successfully elected, honor will be reviewed to confirm whether Huawei is really minimizing or circumventing sanctions by spinning off brands. Biden also said on Tuesday that he saw Huawei as a "national security threat" and wanted to keep the company on the trade blacklist unless "things change."
Derek Scissors, a China expert at the conservative American Enterprise Institute, accused Congress of being too "obsessed" with the Huawei issue, saying it was not a top 10 or even a top 20 issue in U.S.-China policy. But he argues that honor is still reasonable to include glory on the entity list because it was once part of a "fully investigated bad actor."
Paul Triolo, head of global technology policy practice at Eurasia Group, a U.S. consulting firm, said: "It is difficult to prove that Honor's mobile phone manufacturing poses a threat to U.S. national security." Because it has no core materials or components, and more importantly, Honor's equipment is not sold in the United States. ”
Some experts also said that if there is no evidence that Honor illegally delivered U.S. semiconductor chips to Huawei, or that Huawei funded Honor's purchases, there is no reason to sanction it.
In 2019, the Trump administration put Huawei on the entity list on the grounds of "national security issues," requiring suppliers to obtain special licenses when selling products to Huawei. In November, Huawei said it could no longer buy "the components needed to keep Honor running", and had to package and sell Honor to Shenzhen Zhixin New Information Technology Co., Ltd.
Before being included in the entity list, Huawei had been one of the world's largest single buyers of U.S. semiconductor companies. After Huawei was sanctioned, a number of US chip companies complained that the entity list had caused the company's sales to decline or even generate losses, in order to ask the Trump administration to relax the rules.
The U.S. companies say they should be allowed to sell chips and other parts to Huawei, allowing it to make smartphones and laptops because "these will not pose a security risk to the United States." Until now, however, the Biden administration has not taken steps to remove Huawei from the list.
The glory of leaving Huawei's "big tree" to protect grew rapidly. Soon after Honor's independence, several U.S. companies, including Qualcomm, quickly reached an agreement with it to sell chips to it. In January this year, Glory CEO Zhao Ming said that within 2 months after Glory became independent, all suppliers have fully resumed cooperation.
After that, Honor has released new products such as Honor V40, Honor 50, Magic 3 and other series, and its market share in China has gradually increased. Last month, Zhao Ming said at the Honor magic 3 series launch that Honor's market share in China has recovered to 14.6%, becoming the top three brands in China's mobile phone market.
Honor has told the outside world that it is "quickly re-establishing strategic partnerships with some of the world's top suppliers and quickly regaining Huawei's lost market share." ”
Honor's market share change curve shown at the Honor magic 3 conference
The sudden sanctions of the United States have put Huawei in trouble, and Huawei, which is too busy to take care of itself, has to sell glory to let it "find another way to make a living". After independence, Glory quickly resumed cooperation with Qualcomm and other companies, and released a number of new products in succession, and its market share increased steadily.
However, as all this is moving in a better and better direction, the shadow of sanctions once again hangs over glory. If Honor is also included in the entity list of the US Department of Commerce like Huawei, it will be a big blow to the new Glory.
How to effectively deal with sanctions in the shadow of US sanctions in order to seek the survival and development of enterprises is not only a problem that Glory needs to face, but also a practical issue that other technology companies have to consider.
Source: The Washington Post, Reuters