The Analysis of Huawei Event under US International Emergency

CIFER’s Hi-tech Industry Research Report

 

Ju Jiandong, Unigroup Chair Professor at Tsinghua PBCSF, Director of Center for International Finance and Economics Research (CIFER) at Tsinghua NIFR, and Director of Research Center for International Digital Capital at THUIFR.

Ma Xueyan, Research Assistant of Center for International Finance and Economics Research (CIFER) at Tsinghua NIFR.

Last Wednesday, US President Donald Trump signed an Executive Order banned American companies from purchasing telecommunication equipment from Huawei, which will slow down US 5G infrastructure development since Huawei provides lower-cost 5G technology and service.

Later, the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce add Huawei and its affiliates to the Bureau’s Entity List, on which company requires a license to purchase or transfer American technology.

On the one hand, Huawei has indeed been affected since it relies heavily on American chips and other component suppliers. On the other hand, American suppliers have also been unavoidably affected since Huawei is the world's 5th buyers of chips ranked in 2017.

Even though, the success of smartphone chips by Huawei suggested that it is feasible to make cutting-edge technological breakingthrough based on its large home market.