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US revokes licenses for chip supply to Huawei: American semiconductor companies at risk

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In a turn of events impacting the technology and trade nexus between the United States and China, the US government has rescinded several licenses granted to firms for exporting semiconductors to Huawei Technologies, the Chinese telecom giant. Effective immediately, these revoked licenses halt the shipment of critical technology components, such as chips, which are essential to Huawei’s product development, including their laptops.

This decisive action follows the controversy spurred by Huawei’s recent unveiling of the MateBook X Pro, an AI-powered laptop that runs on Intel’s latest chipset. The product’s release sparked disapproval from US Republican representatives concerned with national security and technology transfer issues. They claimed that the laptop’s launch signaled the Commerce Department’s implicit endorsement of Intel’s sales to Huawei.

The Commerce Department made it clear that certain licenses were indeed revoked, albeit without detailing the precise ones. Multiple parties, including heavyweights in the US legislative body, have been advocating for firmer measures against Huawei, citing national security and protection of American intellectual property.

The revoked licenses could have a significant impact on both Huawei, which depends on chips like Intel’s to power its devices, and on American companies supplying these technologies, as their business engagements with Huawei are critically affected.

Since 2019, following its addition to the US trade restriction list due to espionage concerns, Huawei’s operations have faced severe limitations. Although vendors have been authorized previously to trade with Huawei, involving billions in transactions, these new developments could stifle the company’s technological ambitions.

Despite these restrictions, Huawei continues to showcase growth, particularly in its smartphone sales and smart car components sector. The company’s ability to thrive under stringent conditions has made headlines and stays indicative of their adaptive strategies in navigating global trade and technology constraints.

Editor:Vicky

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