If we rewind history a bit, we could have (almost) anticipated the course of events between Trump and Huawei. Indeed, the American president has had his eye on the Chinese company for some time now, and it has recently escalated to declaring a national emergency to protect US computer networks from "foreign adversaries". Let's review the facts to understand the present and anticipate how this story will unfold in the future....
Every story has a beginning
Of course, if Trump signed an order prohibiting American telecommunications companies from using foreign equipment, thus targeting China and more particularly Huawei, it is for a good reason. And behind that reason, there are facts. The cat and mouse game between the Chinese company and the American president did not start last week.
February 2018: the beginning of a conflict
Indeed, if we go back to the beginning of the conflict between the United States and Huawei, we arrive in February 2018, on the 13th to be exact. It was on that day that, before the Senate Committee, officials from the FBI, the CIA and NSA seriously advised Americans against using Huawei and ZTE products.
Chris Wray, director of the FBI, warned against Huawei's massive arrival on American territory, thus allowing China to influence or even control US telecommunications infrastructure with undetectable espionage. How? Through 5G, a technology Huawei is working hard on, which the National Security Council considers a threat.
December 2018: the arrest of Huawei's CFO
It begins on December 1st in Vancouver, Canada, where the CFO Meng Wanzhou, the daughter of Huawei's founder, is arrested, suspected of violating US sanctions against Iran by passing trade agreements on Huawei's account with the Eastern country. Donald Trump then asked for her extradition to the United States in order to be tried in court.
January 2019: the US justice system against Huawei
In January, tensions rise. On January 16th, the American justice system opens a criminal investigation against Huawei, and on January 28th it announces 23 charges. 13 of them concern Meng Wanzhou and suspicions against Huawei of bank and electronic fraud aimed at circumventing the previously mentioned US sanctions against Iran.
The Chinese company is also accused of industrial espionage and fraud. Let me explain: the Chinese company is initially accused of stealing T-Mobile USA's technology, "Tappy", the robot that reproduces the gestures of the human hand to test smartphones, and secondly of troubled financial relations with its two subsidiaries SkycomTech and Huawei Device USA.
March 2019: the Chinese giant replies
Huawei is not the type to just passively let things happen. That is why on March 7th, the company filed a complaint against the US government. It accuses the latter of prohibiting any American administration or company working with it from purchasing equipment or services from Huawei, on grounds of national security, without any justification. The company thus denounces the damage to its reputation.
May 2019: the drama escalates
In May of this year, we can say that things have seriously accelerated...
May 15, 2019
Donald Trump signs an executive order officially prohibiting American telecommunications companies from working with Chinese companies, including, of course, Huawei.
May 16, 2019
Huawei responded by denouncing what it considers to be an illegitimate measure on the part of the American government. The Chinese firm explains that preventing the trade of its devices in the US "will not make the U.S. more secure or stronger; instead, this will only serve to limit the U.S. to inferior yet more expensive alternatives, leaving the U.S. lagging behind in 5G deployment, and eventually harming the interests of U.S. companies and consumers".
May 19, 2019
Many American companies are cutting off ties with Huawei, such as Google, Qualcomm, and Intel.
May 22, 2019
Four British and Japanese operators have announced that they will suspend sales of Huawei smartphones. The reason? If these smartphones no longer have American technology on board (Google, Qualcomm chips), they lose value and popularity. ARM, which develops and licenses the ARM architecture used in the processors of virtually all smartphones on the market, has also broken off its commercial relationship with Huawei.
May 23, 2019
Then it's Panasonic's turn to break ties with Huawei. The Japanese company suspends trade of its products with the Chinese company.
Is Huawei collateral damage from the US-China trade war?
It is a great classic, a story that is repeated over and over again: who runs the world? And world domination is about economics, of course. Then why is Trump angry? Probably because he is afraid that the US will lose its position of power in trade.
If we go back a little further in history, we arrive in January 2018. At that point, we can say that the Sino-American trade war has been launched. In addition, Trump imposes customs duties on the import of products mainly designed in China, such as washing machines and solar panels.
Why such a decision? China clearly exports more to the United States than Uncle Sam's country exports to the Middle Kingdom. The difference is substantial: $375 billion in 2017, a figure that rises to $378.73 billion in 2018. Thus, in 2018, the United States signed numerous decrees increasing import taxes on its territory, China kicked the ball back, and thus we have escalation.
But several questions arise then: will China allow itself to be jerked around through the Huawei case? Can it impose such an embargo on Apple, for example? Can such commercial pressures lead to a kind of cold war? Many questions like these will probably be answered in the coming months or even weeks.
And what do you think of the unfolding trade war?
Source: Le Figaro