Will Beijing take revenge on Qualcomm, Cisco, Apple, and Boeing?
U.S.-China relations continue to get worse, and the knives may be out for American companies.
Almost exactly a year ago,ย in May 2019, the Trump administration first announcedย its โentity listโ designation for Chinese telecom giant Huawei. These restrictions on American companies exporting critical components to Huawei presented a potential existential threatย to the company, and comprised the most significant salvo in a tech war that has accompanied the trade war. At the time, the Chinese commerce ministry responded by threatening to create an โunreliable entities listโย for American companies โ but this threat never materialized.
Last Friday, the U.S. Commerce Departmentย proposed new rulesย that would tighten the โentity listโ designation, and further restrict Huaweiโs access to American technology. The rules specifically mention HiSilicon, an affiliate of Huaweiโs that recently broke into the list of the worldโs top 10 chipmakers.
China is again threatening an โunreliable entities list,โ this time via the nationalistic tabloid the Global Times. Global Times editor Hรบ Xฤซjรฌn ่ก้ก่ฟ added on Twitter: โBased on what I know, if the U.S. further blocks key technology supply to Huawei, China will activate the โunreliable entity list,โ restrict or investigate U.S. companies such as Qualcomm, Cisco and Apple, and suspend the purchase of Boeing airplanes.โ The same threats appear in an article that was highlighted prominently on the Global Timesโ Chinese-language home page.
How real is the threat to Qualcomm, Cisco, Apple, and Boeing?
It is hard to tell if the threat is credible, especially since it is coming from an unnamed source in the Global Times and not directly from the Chinese commerce ministry. But given the renewed downward spiraling of U.S.-China relationsย in recent weeks, it would be unwise to rule anything out. Things can always โ and almost certainly will โ get worse.
Also last week in worsening U.S.-China ties:
- The Trump administration further escalated the U.S.-China blame game, with the FBI issuing a warning of Chinese attempts to steal U.S. COVID-19 research, and Trump referring to COVID-19 as the โPlague from China.โ China responded to the research theft allegation by asserting that it leads vaccine R&D and has no need to steal.
- New visa restrictions for Chinese journalists working in the U.S. for non-American outlets were announced by the Department of Homeland Security on May 8, in the latest round of a tit-for-tat media spat between the U.S. and China and another loss for press freedom.