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Huawei Gets Temporary Reprieve After Trump-Xi Meeting in Japan

U.S.-based companies will once again be allowed to sell their products to the Chinese tech giant.

A Huawei official speaks on stage at the launch event for the Mate 8 smartphone on January 28, 2016. (Image Credit: Isriya Paireepairit)
A Huawei official speaks on stage at the launch event for the Mate 8 smartphone on January 28, 2016. (Image Credit: Isriya Paireepairit)

United States President Donald Trump on Saturday said that American companies can sell their equipment to Chinese telecommunications firm Huawei provided that the business deals they make do not present a national security problem, reported CNN.

The comments came after Trump met Chinese President Xi Jinping on the sidelines of the Group of Twenty (G20) summit in Japan. The leaders discussed the rising tensions between their countries in relation to trade and tariffs over the past few months.

Earlier in May, Trump had issued an executive order effectively banning Huawei—the second-largest smartphone maker in the world—from doing business in the country. The U.S. government also put pressure on allied countries to cut ties with the Chinese firm.

Officials in the Trump administration have previously voiced concerns about Huawei’s alleged links to the Chinese military. They accused the Chinese company of working against the U.S. national security interests by committing intellectual property theft and installing spying software on American networks.

Huawei has repeatedly rejected the allegations made by the U.S. government and challenged the executive order in American courts. However, it has also been lobbying over the past few weeks to regain access to U.S. companies, according to CNN.

Trump Still Wants Huawei to Be Part of Trade Negotiations With China

CNN reports that Trump sought to reassure the American public about his tough stance on China by clarifying that although U.S. companies could resume their business with Huawei, the Shenzhen-based firm was still part of ongoing trade talks between Beijing and Washington.

Huawei responded to the Trump statement with a tweet from one of the official Twitter accounts of the company, taking a dig at the U.S. president by claiming he had made a U-turn on his initial decision to suspend business with the telecommunications giant.

The Huawei ban, which came into effect last month, banned American companies from selling their goods to Huawei without first obtaining the permission of the U.S. government. Huawei depends on U.S.-based companies for certain hardware and software used in mobile phones.

In the aftermath of the Trump ban, internet services firm Google had suspended business with Huawei. Google supplied the Android mobile operating system used on Huawei phones. Computer chip makers like Intel and Micron also restricted Huawei access to their products in May.

However, Huawei was considering alternatives to both Google and Intel when the Trump statement was released. The Chinese firm had been exploring a new operating system named HongMeng and increasing reliance on computer chips manufactured in China.

CNN reports that the company acknowledged the Trump statement but refused to comment further on the matter. The Trump ban had barred U.S. companies from buying Huawei hardware too, which remains in force despite the temporary reprieve on sales to the company.

Huawei is a Key Customer and Growing Supplier to U.S. Markets

Trump conceded that U.S.-based companies were not very ecstatic with not being able to sell to the second-largest smartphone maker in the world.

CNN reported that computer chip makers Intel and Micron were already exploiting loopholes found in the executive order to resume their shipments to Huawei. Google had also been pressing the Trump administration to offer the Chinese firm some relief.

In addition to smartphones, Huawei is a key supplier of the fifth-generation (5G) of internet cellular technology around the world. However, the U.S. government believes the company could spy on the American public if it is allowed to set up 5G services in the country.

In response to the Trump ban earlier in May, Huawei had said that the U.S. would be forced to look toward inferior and more expensive alternatives for the development of 5G services across the country if it continued to refuse to do business with the Chinse firm, reports CNN.

It is still unclear how American companies will resume their business with Huawei. Larry Kudlow, an economic adviser to Trump, told Fox News on Sunday that some companies may be granted temporary licenses to work with Huawei.

Internet-services firm Google had earlier been issued a temporary license to provide Android updates to existing Huawei devices. However, Huawei will soon have to decide whether it wants to continue working with U.S. companies or switch to other partners as the trade spat between Beijing and Washington escalates into an all-out trade war.

Usman Kabir covers science, space, and technology for Globely News. As a kid, he would make models of the solar system and take part in water rocket competitions. His childhood obsession has led him to a degree in Space Science. Usman likes to spend his free time watching reruns of "Curb Your Enthusiasm" and "Seinfeld."

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