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SMIC asks for US permission to continue supplying Huawei

The spectacle of one Chinese company requiring US permission to do business with another Chinese company perfectly illustrates the paradox of globalisation.

US President Donald Trump would be the first to admit that his core political platform is protectionism – i.e. seeking to protect domestic interests from foreign competition. The main focus of that strategy has been China and, notwithstanding legitimate concerns about state influence, Huawei has been the main tactical stick he has used to beat China with.

The great irony of all this is that Trump has used the tools of globalisation to advance his protectionist agenda. Specifically this has meant attempting to drive Huawei out of business by banning all US companies, equipment and intellectual property from being supplied to Huawei and even banning the use of anything remotely American in the manufacture of any products being sold to the vendor.

So now, according to Beijing News, China’s largest chip fab, Semiconductor Manufacturing International Corporation (SMIC), has applied to the US for permission to supply chips to Huawei. The reason it needs to do it is that some of the specialist machines used in chip fabs are made by US companies such as Applied Materials. Even though SMIC now owns that kit, it still needs to ask President Trump for permission to use it.

The US presumably wouldn’t tolerate a situation in which Qualcomm has to apply to the Chinese government for permission to supply Apple, but that’s where we are. It’s hard to get much more detail from the report, since it’s written in Chinese, but what more is there to say? Given recent precedent we expect SMIC’s request to be denied, which would represent yet another humiliation for the Chinese government.

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56 comments

  1. Avatar Cuan Milton 15/09/2020 @ 8:02 pm

    Trump is 100% spot on to deny them the opportunity to supply Chinese companies after what China had done with covid, SARS and other viruses. Why should he trust China? There are riots in the USA inspired by China. Kick China out of America.

    • Avatar James Chan 16/09/2020 @ 1:24 pm

      US is a poor loser. Everywhere in the world they sold seeds rivalry and animosity fro Venezuela to Middle East, from Russia to China, Hong-Kong, Now Thailand. They pay troublemakers instead of upgrading their infrastructures. Deny orld warming creating highest climactic changes resulting in ravaging fires worldwide. Everyone including Americans, British, Europeans agree the safest place on earth is in China!

      • Avatar B. MacShaw 16/09/2020 @ 8:15 pm

        James,
        The US slowed down Manufacturing for close to 50 years as Liberals sought to destroy American Manufacturing, transfer all Western creativity east — ¿Why on Earth would global warming blaze California if China steers more CO2 in the East than in the far West…

      • Avatar s wells 17/09/2020 @ 1:00 am

        That’s funny, everyone knows china is the largest contributor to global warming emissions.

    • Avatar Fai 16/09/2020 @ 1:40 pm

      This a typical brain washed people by US proganda. Trump Failing on everything he touched but succeeded in blaming everyone but himself. For trump blaming other with lies and lies in front of your face is the only tactic and only fool like u believed everything he said. At the end, trump still does care about people like you but himself. US said hk riot was freedom and democratic right of hk people. TRUMP SAID, Riot in US was anti Trump and not related to freedom democratic right. People like you believed him and blame China, THID IS WHAT MADE uS great again, great lier, great fool!!

      • Avatar Oi 17/09/2020 @ 10:08 am

        Yes, the US needs a humble leader who is not afraid to admit his mistakes, and encourages an open and free dialog. Like in China!

      • Avatar happiman 17/09/2020 @ 4:35 pm

        Fool Fai,
        It’s not about Trump but China. They block everything,
        Facebook.com.
        Twitter.com.
        Instagram.com.
        Pinterest.com.
        Tumblr.com.
        Snapchat.com.
        Picasa.google.com.
        Flickr.com
        Netflix
        and Winnie the Poo
        Why they do that? Because they are cheaters, stealers and lairs
        Fai, remember, lairs, cheaters will never win.

    • Avatar Jonathan liu 16/09/2020 @ 3:38 pm

      Hahaha u sound like a sore loser like trump.
      Mate America did shit with covid and all u can do is blame China for your own incompetence in handling the virus. America like many other countires had a good head start to deal with it but what did Americans president do instead? Tell the people the virus was nothing to worry about it was all a hoax it will go away in the summer so he can hold rallies.
      America ain’t top dog anymore and it’s worried so can only use its muscles to pull strings with other countries to get China to lose its position in the 5G race and in global trade.

      • Avatar Xiaohu 16/09/2020 @ 11:00 pm

        America is giving China a taste of its own medicine. The golden age of china has ended. Now China know how it feels about protectionism. I remember when China kicked Google out of country so that Baidu search can be supreme Google ended up being Global number 1 search engine without China’s help. Nobody knows about baidu today. The US giant has awaken and doing what china has done against other nations – protectionism. Chinese companies are being banned all over the world because of the chinese government actions. Nobody respects China.

      • Avatar happiman 17/09/2020 @ 4:41 pm

        Fool Liu and pure Chinese descendants,
        Don’t forget the origin of virus was dirty Chinese street market. Your historical dirty culture ruined the life of normal people globally. You dirty, rude and shameless Chinese people are common enemy of the nations.

        Why are all these bad things coming out of China?

        • Avatar Jason Moore 18/09/2020 @ 2:56 am

          @happiman, Yes the virus was discovered by the Chinese in the market. They should win the noble prize for the discovery. But who are the ones dying and spreading it to this day? Americans are stupid they want to spread it. The Chinese are asking us why are we not wearing masking and why are we still spreading it even today in Sept. Yes Chinese discovered the virus. Chinese discovered many things. You should praise them for their discovery. But who is spreading it to this day? Chinese can control it but can Americans control it? If the virus was discovered in America and people in China was spreading it. It will be another story. Where was H1N1 1st discovered? Why is it not well known where H1N1 was discovered but when China discovered something it became famous? Chinese should win the noble prize for the discovery of Covid19.

    • Avatar Jason Moore 18/09/2020 @ 2:46 am

      You sound racist. Covid was discovered by the Chinese. Americans were the ones who spread it to this day. President Xi warned Trump in January how serious the virus was and how it was transmitted in the air. But the whole year Trump down played it. China was transparent telling Trump it was serious and transmitted in the air. Trump was not transparent by telling his people to wear a mask. Trump told people to stop wearing mask and cover up what President Xi told him. It was all recorded in an interview early Feb. To blame China for the spread is just stupid. If America had President Xi as the leader we will not be in this mess. China controlled the virus so well that they opened up their country while we in US are still dying. China is asking us why are we still spreading it and not wearing mask. You should thank China for the discovery of the virus and the warning and blame Trump for forcing his people to spread it.

      • Avatar happiman 18/09/2020 @ 11:50 pm

        Why do you think Covid was discovered in China at the dirty market street?

  2. Avatar TallyHo Farm 15/09/2020 @ 11:30 pm

    As US r politically runned by lawyers, litigation is their main way to compete. Engineers-runned China just build n innovate to compete…

      • Avatar Greg 21/09/2020 @ 2:50 pm

        It sounds like the current situation is not what you said. It is more like: If I can not win, I destroy you.

        This also ruins the credit to US that any
        US companies promoted their the best machines with the best technology, they have to warn their customers, this is the best machine in the world, but my government will allow you whom you could serve to. So rediculious…

  3. Avatar Benjamin Wilson 15/09/2020 @ 11:39 pm

    Think huawei should have bought ARM then they could have had good leverage in tech world war that’s going on

    • Avatar Ramkie 16/09/2020 @ 1:33 pm

      For that Birtish government wouldn’t have allowed the sale if Chinese participate in the bid to aquire ARM.. Obviously

  4. Avatar Frederick Chu 15/09/2020 @ 11:50 pm

    It’s a hard decision but a correct approach. If we do not cut off the supply we probably will regret in the near future.

  5. Avatar B 16/09/2020 @ 2:13 am

    Historia Magistra vitae est. Funny how the US repeats many mistakes that other actors made in dealing with China.
    In the late 1950s, the USSR stopped cooperation with China and was sure that the Chinese would never develop a nuclear bomb or a satelite. They developed both.
    In the early 2000s, after the US applied pressure, the EU stopped cooperation with China in Galileo satelite positioning system. The Chinese developed Beidou which is currently the best.
    Once the Chinese develop their own chip industry, the US can basically say farewell to its chip industry because they will be pushed away from the market. Selling American chips to China was the best way to assure that the Chinese would not develop its independent production chain.

    • Avatar Oi 17/09/2020 @ 10:22 am

      Yes, China has managed to build many great things over the last decades. However, they didn’t develop these things. Look up the word… FYI, the Chinese satellite positioning system is still inferior to GPS in terms of both resolution and global coverage, but it’s certainly good enough for population surveillance and the direction of missiles…

  6. Avatar Thomas Foo 16/09/2020 @ 3:30 am

    SMIC is being polite as she can ignore the Americans as the kits are theirs and in China.
    No way that the Americans can take them back.
    Pretending to be a pig to eat the tiger as the Chinese saying.
    Secretly, the Chinese are copying the machines and one fine day will the Americans to get lost.🤣🤣🤣🤣

    • Avatar LRS 16/09/2020 @ 6:13 am

      Copying the machines….that’s exactly why we are where we are….you think its ok to copy the machines. However, you are incorrect in thinking the machines there will continue to operate without their American owners supporting them.

      • Avatar Mzee 16/09/2020 @ 7:05 pm

        There’s nothing wrong with China making their own machines, Apple was made in China using Chinese machines, where is Apple being made now, didn’t America make their own machines from Chinese technology

    • Avatar Shafiq Alassi 16/09/2020 @ 6:27 am

      Exactly.
      The inevitable end of story that American will find themselves are out of the game.

  7. Avatar lepekola 16/09/2020 @ 3:40 am

    Interesting indeed, surely Huawei has a strategy to overcome Trumps tactics to take them out of the game.

    • Avatar Oi 17/09/2020 @ 10:35 am

      Huawei as a phone manufacturer is finished. They’ll be busy enough building 4g and 5g networks in the Belt&Road and Africa (getting paid in RMB from Chinese high-interest loans…). Enough regimes in the world who won’t mind joining hands with the CCP in this endeavour… Meanwhile, OPPO, Vivo, Xiaomi or Lenovo will become the CCP’s new best friend (for a price…). There is no lack of phone manufacturers in China who can take over after Huawei…

  8. Avatar LEO CHEW 16/09/2020 @ 4:21 am

    another example of US absurd actions.
    if u buy my car beware I’ll not allow u to seat ur friends.

  9. Avatar lamfw3 16/09/2020 @ 5:43 am

    Trump the LOSER.

  10. Avatar Banjo 16/09/2020 @ 5:54 am

    Trump is forcing China to become better. Within a few years, I predict that China will supply the world with chips and USA will loose its share of the cake. R&D spending and the number of patents are much more important in China than in the rest of the world.

  11. Avatar MARAKA ANTONY KIMTAI 16/09/2020 @ 6:26 am

    This issue will be a positive thing to the Chinese companies in the long term.
    Many of them will be able to manufacture their own equipment and codes without help from outside.
    This will impact negatively on the USA companies and create a void in American technology.
    China will have managed to stand out as a super power, wait and see.
    “The last one to laugh, laughs loudly”

  12. Avatar Peter Lee 16/09/2020 @ 7:05 am

    The Dragon had been awaken years ago and now forced to fly higher. Thanks to the Eagle (Oops! Is Donkey now). Donkey Vs Dragon, the Dragon will bring the Donkey for a ride, Hold on tight and enjoy, Donkey. 😉

  13. Avatar buddy lau 16/09/2020 @ 8:14 am

    One step back, will be two step foward for a determined society. Pressure a catalyst for growth. Temporary set back, for all, except the weak parasite who need protection.

  14. Avatar Sabzonline 16/09/2020 @ 9:43 am

    Trump with his bully tact acts will only serve to motivate chines firms to be more innovative and develop their technologies indipendently of America’s cooperation…which at the end will remove America from being world leaders when it comes to innovation… This will only serve to make chines firms to be more aggressive in their R&D… 😊 😊 😊

  15. Avatar Fredrick 16/09/2020 @ 9:47 am

    China will surely come out stronger in the long run…

  16. Avatar Jonathan O 16/09/2020 @ 11:09 am

    The current vain joy for US in unreasonably banning chip supplies to China will be short one. The short-sightedness of American strategy and tactics to contain China’s rise is deafening. Instead of working harder and smarter in fair competition with China and therefore becoming stronger and more respectable themselves, the US are using all the ugliest,dirtiest and meanest tactics they can think of to try to kill off Huawei/China. But inwardly the US is peeing in their pants knowing sooner or later they will be circumvened and overtaken. Walla! Game Over. Make peace and not war while you can! Learn from history and don’t be pig-headed.

  17. Avatar Paul Geal 16/09/2020 @ 12:28 pm

    As for China being a superpower that will never be because the USA will destroy that country and that will be .to think they are in power are not good and be charged with murder and pay with their lives and they will

  18. Avatar V 16/09/2020 @ 12:45 pm

    Therein lies the conundrum. The strategists in the US know full well that if they hamstring China’s progress there will be a price to pay in accelerated Chinese progress. They probably calculated that there’s more to gain that way than to further support Chinese tech. What’s for sure is that the US can ill afford to lose the commanding heights of technology because with that comes the loss of prestige, economic prospects, and the reserve currency status of the dollar. Nightmare scenario for the average American politician.

  19. Avatar Little black duck 16/09/2020 @ 12:49 pm

    The bright side immediately is that we have coming a new, IoT, operating system. When I lay hands on the Mate 40Pro it will have or be able to run Harmony and still run Android Open compatible apps. Until then it remains ‘ringside at the opera’! 🙂

  20. Avatar 4 16/09/2020 @ 1:30 pm

    The rise of China is real and every country having close ties will benefit from their investments and technology. All China wants since long time ago is to trade fairly. Its citizens work extremely hard and very creative as a matter of survival. They understand perfectly what African and Latin America is undergoing.

    • Avatar One punch man 17/09/2020 @ 2:34 pm

      Could agree more. Progress is progress nothing further than the truth. In the desparate times of saving the planet a lot more work is required to set aside get rich quick schemes and address the real issues for the next generation. Humanity first not yanky bullshit. Peace & Love

  21. Avatar Peter Loo Jun 16/09/2020 @ 2:12 pm

    When the US government led by Trump tried to bully China by imposing so many sanctions, the Chinese government and its people know what to do. History had shown that when the Chinese were bullied by any country, the people inspired by the present government would find ways to overcome these onslaughts. Deprived Huawei of the chips, the Company with the support of the Government will find its way out. With resilience and tenacity, Huawei, with support from majority of the Chinese and a supportive Government, will see the light at the end of the tunnel.

  22. Avatar Toni 16/09/2020 @ 2:21 pm

    Before China can become a true global superpower she needs to lead in high technology. Right now china is behind in everything from critical military technologies to commercial semiconductor and everything else. The Chinese are learning fast but it could take 30 years or more to achieve technology parity with the westerners under the best scenario.

  23. Avatar Tingajoe 16/09/2020 @ 3:15 pm

    Someone has decided this is the time to break China because after this it won’t be possible. What is not clear is if they will break the world to bring down China.

  24. Avatar Phartahu 16/09/2020 @ 3:17 pm

    With blocking chips supply to Huawei, it’s very obvious that the US is jx too jealous and perhaps envious of China’s progress. It will hurt Huawei though but is a lesson for them and the other tech company as well.Is jx the matter of time, Huawei will rise,China will rise.Enough of US bullying.

  25. Avatar EN 16/09/2020 @ 7:49 pm

    1. This is not really protectionism. Because by banning huawei, no American company is going to benefit. In fact American mobile companies will have to pay more for procuring 5g network from European vendors.
    2. America is not the only country which is banning huawei.

  26. Avatar Skali 16/09/2020 @ 10:10 pm

    It is not clear what action USA can take if SMIC continues to supply chips to Huawei. They own the equipment after buying it. I don’t have to take permission from Apple on using phone to call anyone. Chinese are being timid.Trump’s restrictions are illegal.

  27. Avatar Oi 17/09/2020 @ 10:57 am

    5 years ago nobody outside China hah even heard of Huawei. The talk-of-the-town back then was Xiaomi. The only Chinese phone available in the UK was ZTE’s blade…

    Huawei is clearly finished as a phone manufacturer, but that is not really important. They’ll be more than busy building networks in Africa and the Belt&Road (getting handsomely paid in RMB from Chinese high-interest loans…). Meanwhile, the CCP will just make a new best friend in China (my bet is on OPPO or Vivo…). Of course, CCP friendship comes at a price, but it’s not like anyone will have much of a choice in the matter anyway…

  28. Avatar happiman 17/09/2020 @ 4:22 pm

    Brain washed Asian Nazi Chinese government almost always lies. They encourage their foreign students to cheat, lie and steal.
    https://www.lamag.com/citythinkblog/ucla-cheating/
    China has a long history of cheating. They put the cheating the second highest social norm next to the unlimited loyalty to their corrupted government. They were raised to be a skillful cheater and practice while they are studying abroad.
    Once they have become a master, they recruit locals to sell their product internationally. Huawei has the best of the best from those cheaters.

    In 2018 a professor at UC Santa Barbara told the Los Angeles Times that Chinese students comprise 6 percent of the student body but account for a third of plagiarism cases
    Few suggest that Chinese students, who make up a third of all international students in the U.S., cheat at higher rates than students from other foreign countries.
    In 2016 Reuters reported that the University of Iowa was investigating at least 30 students—most, if not all, believed to be Chinese—over allegations of cheating.

  29. Avatar Ob Server 22/09/2020 @ 11:17 am

    Chinese 5G techology is 2-3 years ahead versus USA based 5G. How to copy that?

    US authorities do no have access to Huawei Phones, that was why huawei is banned.

    Look TikTok… TikTok was security problem, until it sell to Oracle & Wallmart. What happen to security problem ???

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