Trump Hits Huawei In the Mouth: How Can That Hit You In the Pocket?

Trump Hits Huawei In the Mouth: How Can That Hit You In the Pocket?

Last week, as trade tensions continued to rise between China and the US, the Trump administration landed one of the heaviest blows yet on Beijing, moving to severely restrict the Chinese tech and telecoms giant Huawei's ability to do business with American firms.

What happened? Two things: The Trump administration formally banned sales of Huawei telecoms equipment in the US. More importantly, it also prohibited American firms from selling their technology to Huawei without a special license.

Why? It's complicated. Technically, Huawei was blacklisted from acquiring US technology due to alleged violations of US sanctions against Iran. But the US is also concerned that Huawei could allow Beijing to spy on or disrupt data flowing across the next-generation 5G data networks of the US or its allies. President Trump may also believe the moves will give him extra leverage in his broader fight with Beijing over trade and technology.

The fallout is already starting to hit. Here's where:


Your pocket: Check your phone, because if you're one of the 200 million people worldwide who bought a Huawei handset last year, you may have stopped receiving software updates over the weekend from Google, whose Android mobile operating system powers Huawei's smartphones.

The US yesterday issued a temporary license that will allow software updates to "existing" handsets for 90 days – but that's not long. As other US tech companies distance themselves from Huawei, and the company is forced to find new suppliers, the cost of cellphones and other telecoms equipment will rise, both for consumers and companies.

US-China relations: This is potentially a huge blow to China. Huawei is a world leader in 5G technology, the next generation of mobile networks needed to run driverless cars and smart cities. But the company still relies on US-built chips and software, so losing access to American suppliers is a big deal.

If Huawei can't negotiate its way out of Trump's new measures, Beijing could retaliate by messing with US tech companies like Apple that do huge business in China, or by attempting to restrict US firms' access to China's massive supply of rare earths metals which are essential to powering many smartphones and other high-tech gadgets.

The structure of the global economy: Over the past 30 years, the globalization of supply chains – that is, firms sourcing parts and labor from the countries that can supply those things most efficiently – has generally been seen as a good thing. It reduced the cost of goods for Western consumers, gave developing countries a leg up, and created economic interdependencies thought to minimize the chance of war.

But forbidding the largest US tech firms from doing business with the largest Chinese ones is a direct rejection of that idea. As this astute Twitter thread points out, this is new and uncharted territory.

The upshot: The US and China still have time to find a solution, but the risk of a geopolitical break with major consequences for your wallet, for US-China relations, and even for the global economy is rising. Fast.

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Back in August, when the Taliban took over, we asked whether anyone in the international community would recognize them. Now it looks like things are heading that way.

This week, the Kremlin hosted a summit with the Taliban that was attended by China, India and Pakistan, as well as all five Central Asian Republics.

The domestically-focused US, however, wasn't there. The US continues to maintain that the Taliban can't be trusted. But does it matter? In 2021 does a Taliban-led government even need American recognition to function and thrive?

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Taking place on October 21 and 22, the Sustainability Leaders Summit will go beyond preexisting narratives and debate priorities for governments and industries ahead of COP26. Placing the spotlight on Asia's role in the global sustainability agenda, the event will address whether Asian countries and companies can achieve shared sustainability goals, and what is needed to help get them there. The summit will be co-hosted by Tak Niinami, CEO of Suntory Holdings, and Ian Bremmer, founder and president of Eurasia Group and GZERO Media. We will address three key questions: How can Asian countries, with the help of the private sector, achieve shared Sustainability Goals? Why does this matter? And what are the policy changes needed to bring it about?

Attendance is free and open to the public. Register to attend.

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For Kevin Rudd, former Australian PM and now CEO of the Asia Society, the science on climate change is pretty much done, so the only unresolved issues are tech and — more importantly — lack of political leadership. He can't think of a single national political leader who can fill the role, and says the only way to get political action on climate is to mobilize public opinion.

Rudd joined for the first of a two-part Sustainability Leaders Summit livestream conversation sponsored by Suntory. Watch here and register here to watch part two Friday 10/22 at 8 am ET.

The minutiae of supply chains makes for boring dinner table talk, but it's increasingly becoming a hot topic of conversation now that packages are taking much longer to arrive in the consumer-oriented US, while prices of goods soar.

With the issue unlikely to be resolved anytime soon, right-wing media have dubbed President Biden the Grinch Who Stole Christmas, conjuring images of sad Christmas trees surrounded by distraught children whose holiday gifts are stuck somewhere in the Pacific Ocean.

It hasn't been a good run for Uncle Joe in recent months. What issues are tripping him up?

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Ian Bremmer shares his insights on global politics this week with a look at the NBA's latest rift with China, Brazil's Senate investigation, and COVID booster shots.

China wipes Boston Celtics from NBA broadcast after the "Free Tibet" speech from Enes Kanter. Is NBA boxing itself into a corner?

Nice mixed sports metaphor there. NBA has some challenges because they are of course the most progressive on political and social issues in the United States among sports leagues, but not when it comes to China, their most important international market. And you've seen that with LeBron James telling everyone about we need to learn better from the Communist Party on issues like Hong Kong and how Daryl Morey got hammered for taking his stance in favor of Hong Kong democracy. Well, Enes Kanter's doing the same thing and he's a second-string center. Didn't even play yesterday and still the Chinese said that they were not going to air any Boston Celtics games. Why? Because he criticized the Chinese government and had some "Free Tibet" sneakers. This is a real problem for a lot of corporations out there, but particularly publicly, the NBA. Watch for a bunch of American politicians to make it harder for the NBA going forward, saying how dare you kowtow to the Chinese when you're all about "Black Lives Matter" inside the United States. No fun.

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Jon Lieber, head of Eurasia Group's coverage of political and policy developments in Washington, shares insights on US politics:

A Trump media platform? Is this for real?

This week, President Trump announced his potential return to social media through the creation of his own digital media platform that's going to merge with an existing publicly-traded company in a deal known as a SPAC. These deals are increasingly popular for getting access to capital, and it seems like that's where President Trump is headed.

The publicly-traded company's stock was up on the news, but it's really hard to see this coming together. The Trump media company claims it wants to go up against not only Facebook and Twitter, but companies like Amazon and cloud computing and even Disney providing a safe space for conservatives to share their points of view. The fact of the matter is, conservatives do quite well on existing social media platforms when they aren't being kicked off for violating the terms of service, and other conservative social media platforms that have attempted to launch this year haven't really gone off the ground.

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Protests in Sudan: Protests are again shaking the Sudanese capital, as supporters of rival wings of the transitional government take to the streets. Back in 2019, after popular demonstrations led to the ouster of longtime autocrat Omar al-Bashir, a deal was struck between civilian activists and the army, in which a joint civilian-military government would run the country until fresh elections could be held in 2023. But now supporters of the military wing are calling on it to dissolve the government entirely, while supporters of the civilian wing are counter-protesting. Making matters worse, a pro-military tribal leader in Eastern Sudan has set up a blockade which is interrupting the flow of goods and food to the capital. The US, which backs the civilian wing, has sent an envoy to Khartoum as tensions rise, while Egypt, the UAE, Saudi Arabia, and Turkey are all vying for a piece as well.

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