The recent US sanctions against Huawei Technologies might have a far reaching impact on the entire US tech industry as a whole. While the Chinese company has lost its chip supply from TSMC, US based companies fear that this move from the Government might end up scaring away its customers.
Back in 2019, Huawei had faced a trade ban by the US Commerce Department. This move caused the Chinese tech giant to lose billions of dollars in revenue. Moving forward by a year, the situation has still not gotten any better with recent sanctions restricting the company’s supply as well. But now, this move may create a bigger gap between the US and Chinese supply chains.
According to an executive of a California-based semiconductor company, “securing new clients in China, or even in Asia, could be more challenging from now on as prospective clients would think twice before they buy American equipment or technologies like ours.” The Chinese market accounted for more than 60 percent of the global semiconductor consumption in 2019. So, the shift away from the US suppliers could potentially hard domestic businesses in America.
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The executive also added that despite the California based company does not directly supply Huawei, “a lot of Chinese tech companies, those buying from us included, have some sorts of relationships with Huawei. There is no way to know whether what we sell to a non-Huawei company will not eventually become part of a Huawei product.” In other words, the US products may eventually be reaching the blacklisted Chinese company.
This translates to potential complications with the US government since the new sanctions dictate that a special license must be obtained to provide products to blacklisted companies. Thus, the unclear nature of the entire transaction and trade could harm the US based companies if their technology is found being used by companies like Huawei later on.
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(Via)
