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Samsung set to cut off Huawei due to US sanctions

Korean component makers Samsung and SK Hynix will be forced to stop supplying Huawei on 15 September if they don’t get a special license from the US.

While this is being extensively reported by South Korean media, the deadline for cutting off Huawei was set in place by the latest round of US restrictions unveiled last month. So Samsung and SK Hynix are in the same boat as Mediatek, being East Asian companies compelled to beg for US permission to go about their business.

According to the reports the Korean companies have made their pilgrimage to the Bureau of Industry and Security, but there’s no indication of them having received a response, one way or the other. Since it’s hard to imagine any technology manufacturing process not using US products or intellectual property at some stage, BIS would have to contradict its own commandments in order to grant that permission, so the smart money is on it being declined.

One of the reports also claims Samsung has won a major deal to manufacture Qualcomm’s lower-tier 5G Snapdragon chips, as part of an effort to expand its customer base in China. Somehow the US restrictions don’t seem to affect other major Chinese smartphone vendors, but since the USD is apparently mulling a move against SMIC next, it seems likely that the remit of this crusade is likely to keep expanding.

China itself has been muted in response to the US assault, limiting itself to sporadic moans. But now it’s being widely reported that the Chinese government has launched a new set of global guidelines for technology companies. This seems to be a direct response to the US Clean Network campaign, which is designed to pressure it allies into removing all traces of Huawei and ZTE from their networks.

“It is important to develop a set of international rules on data security,” Chinese Foreign Minister Wang Yi is reported as saying at the launch of the global data security initiative. “A certain country keeps making groundless accusations against others in the name of a clean network and uses security as a pretext to prey on enterprises of other countries that have a competitive edge. Such blatant acts of bullying must be opposed and rejected.”

Well this is escalating nicely isn’t it? We hate to say we told you so but at the end of the year we predicted that the Balkanisation of the global tech industry would be a key trend this year and so it has. To what extent the US action against China and its companies is merely a form of geopolitical negotiation is unclear, but there’s no sign of China giving any ground. Right now China is doing a good job of isolating itself internationally, but there are bound to be many more twists to this saga.

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9 comments

  1. Avatar Curious Person 09/09/2020 @ 4:17 pm

    Can you, please, clarify what “Balkanisation” means? As someone from Balkan i am really curious.

  2. Avatar Rob 09/09/2020 @ 4:45 pm

    Trump needs to take a step back & look in a mirror to see what a fool looks like “HE CAN’T ROUL THE WORLD HE HASN’T GOT THE GOT THE BRAINS TO STOP TELLING LIES” R

  3. Avatar Happiman 09/09/2020 @ 5:59 pm

    The origin of bullying comes from China and its culture. They still believe that they are the center of the world. (中华人民共和国). The first letter “中” means the center. What they believe that they have achieved comes from either stealing or cheating.
    https://www.lamag.com/citythinkblog/ucla-cheating/

  4. Avatar maxedout 09/09/2020 @ 10:58 pm

    Eventually, every other country will learn from what the US is doing to China and develop their own machines that don’t use US technology. So empire keeps on shooting itself in the foot.

  5. Avatar Peter Paul 10/09/2020 @ 3:47 am

    Decoupling of economy of china ,and us is not good. US will rely on itself, but it will force china to be more independent and self reliant. And a more hostile self reliant China might not be good. Just look at North Korea. Isolation did not bring anything good.Besides china weapon exports are 5% of global trade while Russia is 19% . Trump is ignoring russian threat while obsessed with china

  6. Avatar Paul Geal 10/09/2020 @ 7:29 am

    Do you really is going on in China no you do not so stop these lies about Donald Trump and look at your self first because all I have seen in the past four year is talling bad thing about the Donald Trump it about time so one told you to shut your big mouth it only because he done will for the USA and wait and see what the people are going to do. Because he will win hands down , and as for all news paper I would pack you bags and leave the USA or go to Jail .lol we will see yes when you are all in Jail lol

  7. Avatar Paul Geal 10/09/2020 @ 7:31 am

    Yes you should read this because its coming there way should . Yes you are going to jail lol

  8. Avatar Micky 10/09/2020 @ 1:56 pm

    China has for long used WTO to its advantage and forced companies to give over the tech.Also they didn’t allow many business to operate in China.How come Amazon failed over there but it is success in rest if the world

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