Is Huawei on the brink of US sanction relief?
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Well, well, well: some California Democrats are urging the Biden administration to halt plans for further restrictions on US technology exports to China. According to them, such unilateral measures could harm US businesses while benefiting foreign competitors.
In the recent past, the US has imposed extensive restrictions on the export of chips and chip making equipment to China, driven by concerns that Beijing might use this technology to advance its military capabilities. Although the Netherlands and Japan, which are home to major chip making equipment producers (ASML and Tokyo Electron, respectively) have also imposed export restrictions, they have not matched the U.S.’s strictest measures.
According to Reuters, the Commerce Department is considering a new rule that would broaden US authority to block exports of semiconductor manufacturing equipment from certain foreign countries to Chinese chipmakers, but would exclude Japan and the Netherlands.
In a letter dated August 13, Senator Alex Padilla and Representative Zoe Lofgren expressed concerns that further controls could harm longstanding US companies, noting that US allies have not imposed similar stringent export restrictions.
"We ask that you pause additional unilateral export controls until you have adequately justified that such controls will not damage US competitiveness in advanced semiconductors and semiconductor manufacturing equipment", the lawmakers wrote to Alan Estevez, who oversees export controls at the Commerce Department.
This letter reflects increasing opposition among California Democrats to the Biden administration's semiconductor policies. California is home to leading chip making equipment companies such as LAM, Applied Materials, and KLA.
In April, Governor Gavin Newsom and Senator Padilla had also urged the administration to reverse its decision to cancel a subsidy program for semiconductor research and development, a program that was expected to benefit Applied Materials.
In their August letter, Padilla and Lofgren clarified that they were not asking for a rollback of restrictions on China but were concerned about new rules with dubious national-security benefits when US allies are not imposing similar measures.
"We urge you to use all forms of leverage available to the U.S. government to bring our allies along in aligning their export controls with ours", they wrote.
Personally, I don't think that the US will let go off its grip on Huawei right away, but the fact that some officials are calling on the current administration to halt plans for additional restrictions is a positive sign. Until that happens, Huawei will continue to dominate the Far East region, US sanctions or not.
In the recent past, the US has imposed extensive restrictions on the export of chips and chip making equipment to China, driven by concerns that Beijing might use this technology to advance its military capabilities. Although the Netherlands and Japan, which are home to major chip making equipment producers (ASML and Tokyo Electron, respectively) have also imposed export restrictions, they have not matched the U.S.’s strictest measures.
In a letter dated August 13, Senator Alex Padilla and Representative Zoe Lofgren expressed concerns that further controls could harm longstanding US companies, noting that US allies have not imposed similar stringent export restrictions.
This letter reflects increasing opposition among California Democrats to the Biden administration's semiconductor policies. California is home to leading chip making equipment companies such as LAM, Applied Materials, and KLA.
In April, Governor Gavin Newsom and Senator Padilla had also urged the administration to reverse its decision to cancel a subsidy program for semiconductor research and development, a program that was expected to benefit Applied Materials.
Personally, I don't think that the US will let go off its grip on Huawei right away, but the fact that some officials are calling on the current administration to halt plans for additional restrictions is a positive sign. Until that happens, Huawei will continue to dominate the Far East region, US sanctions or not.
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