Technology

Huawei blacklist will enflame US-China trade war

Huawei blacklist will enflame US-China trade war

Dubai

Of all the ways that the United States could have dealt with the ongoing security concerns over Huawei, last week’s blacklisting was probably the most ham-handed, disruptive solution imaginable.

I’m not convinced that Huawei deserved to be banned in the US, but the company’s overly-simple response that “we don’t spy” was never going to be an adequate explanation from a company once so well tied to the Chinese army.

Huawei has faced known security issues, including the discovery of a number of “back doors” — software loopholes that allow a user to bypass security — in its European networking equipment. Given these concerns and the company’s previous connections to the Chinese army, its dismissive attitude towards the accusations seemed intended to draw a harsh rebuke from the US.

But the US’s actions do not seem to be in good faith, either.

The ongoing US trade war with China is a political mechanism of US President Donald Trump with little grounding in economics. The decision to blacklist Huawei, made so soon after trade negotiations broke down last week, smacks of brinkmanship.

China is sure to retaliate, with US tech companies — and Apple in particular — being the most discussed targets. That seems unlikely, given that any blacklisting of Apple products would itself have a negative impact on China’s manufacturing sector, but at this point, there are concerns that national pride may replace pragmatism.

This is not a small issue that will go away soon. The US cannot demand China buys its good and services and then refuse to give Chinese companies a seat at the trade table. As China continues to increase its global influence, more companies with prior links to the Chinese government will enter the market place. The world needs to find a way to balance their concerns about security with the desire of the Chinese to grow, and those companies will need to be transparent in a manner that is uncomfortable for them.

Ultimatums based on ego or politics will only make this situation worse.