China’s government accused Washington on Tuesday of pursuing “technology hegemony,” following reports the United States might step up pressure on tech giant Huawei by blocking all access to American suppliers.
The Biden administration is weighing further limiting the Chinese tech giant’s ability to purchase essential components from U.S. suppliers, which could restrict Huawei’s access to processor chips and other technology, according to a person familiar with the matter. The person was not authorized to comment on the sensitive manner and so spoke on the condition of anonymity.
The company, which makes network equipment and smartphones, since 2019 has been on the U.S. Commerce Department’s entity list, comprising those subject to licensing requirement, but has been allowed to buy some less-advanced components.
Bloomberg News and the Financial Times first reported that the administration was weighing the move.
Huawei Technologies Ltd., China’s first global tech brand, is at the center of a conflict between Washington and Beijing over technology and security. U.S. officials say Huawei is a security risk and might facilitate Chinese spying, an accusation the company denies.
“China is gravely concerned about the reports,” said a foreign ministry spokeswoman, Mao Ning. She accused Washington of “over-stretching the concept of national security and abusing state power” to suppress Chinese competitors.
“Such practices are contrary to the principles of market economy” and are “blatant technological hegemony,” Mao said.
The White House and Commerce Department declined to comment about specific deliberations regarding Huawei.
“Working closely with our interagency export controls partners at the Departments of Energy, Defense and State, we continually assess our policies and regulations and communicate regularly with external stakeholders,” the Commerce Department said in a statement. “We do not comment on conversations with or deliberations about specific companies.”
Mao said Beijing would “defend the legitimate rights” of its companies but gave no indication how the government might respond. Beijing has made similar declarations after past U.S. action against its companies but often does nothing.
The ban on sales of advanced U.S. processor chips and music, maps and other services from Alphabet Inc.’s Google unit crippled Huawei’s smartphone business. The company sold its low-end Honor smartphone brand to revive sales by separating it from the sanctions on its corporate parent.
The Commerce Department agreed to grant export licenses to U.S. companies to allow them to sell less-advanced chips and other technology to Huawei that was deemed not to be a security risk. That followed complaints suppliers would lose billions of dollars in annual sales.
The Biden administration is considering no longer granting such licenses, although no decision has been made, according to the person familiar with the deliberations.
Huawei scrambled to remove U.S. components from its network and other products and has launched new business lines serving factories, self-driving cars and other industrial customers. The company hopes those are less vulnerable to U.S. pressure.
Huawei says its business is starting to rebound.
“In 2020, we successfully pulled ourselves out of crisis mode,” Eric Xu, one of three Huawei executives who take turns as chairman, said in a December letter to employees. “U.S. restrictions are now our new normal, and we’re back to business as usual.”
Last year’s revenue was forecast to be little-changed from 2021 at 636.9 billion yuan ($91.6 billion), Xu said.