Recently, US Commerce Secretary Wilbur Ross told Bloomberg that the United States is planning on stepping up the conditions of the trade ban against Huawei.
Only last week, Huawei founder Ren Zhengfei told the media that it was expecting the US to clamp down even harder on Huawei but the company has the capacity to survive against tougher conditions.
Turns out, Zhengfei was right. According to Ross, the new terms and conditions are “works in progress that will come out near-term.”
We don’t know if and when the new conditions will come into effect. However, based on Bloomberg’s sources, the US Commerce Department is planning to raise the threshold for products that are exempted from being sold to the Chinese tech giant.
Currently, US companies are allowed to export products and components to Huawei that have more than 75 percent of IP and work done outside of the US. However, it is expected that the Trump government will raise the bar to 90 percent, narrowing the list of products that can be exported.
In other news, it was also revealed that the US government is working on a separate regulation that will affect the products designed in the US but manufactured overseas.
Even though the US has been giving Huawei a tough time, it is helping the company become self-sufficient. Huawei’s sales in the local market spiked at the end of 2019 and it is expecting another increase in 2020. Let’s see how things work out for both parties.