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.

Yau Abdul Karim lives and works in Garin Mai Jalah, located in the Yobe State of northeastern Nigeria. Essential to his work raising cattle is reliable access to water, yet environmental degradation has led to fewer water sources, severely impacting communities like his that depend on livestock. In 2019, with the help of FAO, Eni installed a special solar-powered well in Yau's town that provides water during the day as well as light at night.

Watch Yau's story as he shows how his family and community enjoy life-enhancing access to both water and light.

Ian Bremmer's Quick Take:

Hi, everybody. Ian Bremmer here. And I thought I'd talk a little bit today about the latest in Israel, Palestine. It's obviously been driving headlines all week. And of course, on social media, there's no topic that we all get along and agree with each other more than Israel, Palestine. It's an easy one to take on. Yeah, I know I'm completely full of crap on that. But I thought I would give you some sense of what I think is actually happening where we're going. So first point, massive fight, big conflict between Hamas in Gaza and the Israeli defense forces. Not only that, but also more violence and a lot of violence breaking out between Israeli Arabs and Israeli Jews. Extremists on both sides taking to the streets and fairly indiscriminate violence, in this case, worst since 2014.

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Nicola Sturgeon, Scotland's first minister, says another independence referendum for Scotland is now a matter of "when not if," and that after leaving the UK, Scotland will launch a bid to rejoin the EU. But there are formidable obstacles ahead.

Getting to a vote will force a complex game of chicken with UK Prime Minister Boris Johnson. If a majority of Scots then vote for independence — hardly a sure thing – the process of extricating their new country from the UK will make Brexit look easy. Next, come the challenges of EU accession. In other words, Scotland's journey down the rocky road ahead has only just begun.

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Cyber is a tool, and sometimes a weapon. Whether espionage for commercial gain or indiscriminate attacks on critical infrastructure, actions taken in cyber space affect you directly, potentially upending even the most mundane realities of everyday life.

Join GZERO Media and Microsoft for a live conversation on cyber challenges facing governments, companies, and citizens in a Munich Security Conference "Road to Munich" event on Tuesday, May 18.

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According to Delhi-based journalist Barkha Dutt, while the Indian government has finally started to mobilize in response to the COVID crisis, there's still a lot of denial about the severity of the ourbreak. "Our Health Minister, for instance, made a statement in the last 24 hours saying that India is better equipped to fight COVID in 2021 than in 2020. That's simply rubbish. We had India's Solicitor General telling the Supreme Court that there is no oxygen deficit as of now. That's simply not true." In an interview on GZERO World, Dutt tells Ian Bremmer that only the connection between fellow Indians, helping each other when the government cannot, has been a salve.

Watch the episode: India's COVID calamity

Listen: Ask national security experts how they view China today and they'll likely the use a term like "adversary" or "economic competitor." But what about "enemy?" How close is the world to all-out-war breaking out between United States and China? According to US Admiral James Stavridis (Ret.), who served as Supreme Allied Commander to NATO, those odds are higher than many would like to admit. In fact, Stavridis says, the US risks losing its military dominance in the coming years to China. And if push comes to shove in a military conflict, it's not entirely clear who would prevail. Admiral Stavridis discusses his bestselling new military thriller 2034 and makes the case for why his fictional depiction of a US-China war could easily become reality.

Subscribe to the GZERO World Podcast on Apple Podcasts, Spotify, Stitcher, or your preferred podcast platform to receive new episodes as soon as they're published.

Carl Bildt, former Prime Minister and Foreign Minister of Sweden, shares his perspective on Europe In 60 Seconds:

What's the issue with the letter in France talking about the "civil war"?

Well, I think it is part of the beginning of the French election campaign. We have some people in the military encouraged by the more right-wing forces, warning very much for the Muslim question. That's part of the upstart to the election campaign next year. More to come, I fear.

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When asked about where a US-China war may start, US Admiral James Stavridis (Ret.) doesn't hesitate: Taiwan. He suggests that China may believe the US is distracted by internal politics: "I think it would be a miscalculation on the part of the Chinese, but they may calculate that now is the moment." How would a move against Taiwan play out? Stavridis speculates how the Chinese military may plan to invade the island on the upcoming episode of GZERO World, which begins airing on US public television Friday, May 14. Check local listings.

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Beyond SolarWinds: Securing Cyberspace. Watch on Tuesday, May 18, 2021 10am PT/ 1pm ET

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Beyond SolarWinds: Securing Cyberspace | Watch on Tuesday, May 18, 2021 10am PT / 1 pm PT

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Subscribe to GZERO Media's newsletter: Signal