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News > China

Trump's Decision to Ease Huawei Ban Boosts Market Shares

  • After easing Huawei's ban, U.S. firms will be able to sell components to the company.

    After easing Huawei's ban, U.S. firms will be able to sell components to the company. | Photo: Reuters

Published 1 July 2019

U.S. President Donald Trump’s decision to allow U.S. firms to sell equipement to Huawei boosted shares of Huawei's Asian suppliers.

United States (U.S.) President Donald Trump’s decision to lift the ban on U.S. firms working with Chinese company Huawei snapped up market shares in suppliers to the Chinese smartphone maker Monday, even though some experts have doubts on what has really changed.


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Trump announced Saturday following an encounter with Chinese President Xi Jinping, that U.S. firms would be able to sell components to the world’s biggest telecoms network gear maker if there were no national security issues.

In a complete turnaround, U.S. President announced the ban was unfair to U.S. suppliers who could not sell parts and components to Huawei without approval from authorities. Several U.S. companies who had stopped supplying the Chinese firm quietly lobbied the government to ease the ban.

Meanwhile, the announcement has been considered as positive signs by investors and shares in Huawei’s smartphone major suppliers jumped in Asian trading Monday. The Chinese company, for its part, said it acknowledged the U.S. president’s comments but made no comments for now.

OLED display panel maker BOE Technology Group and Shenzhen Goodix Technology, a maker of fingerprint sensors, climbed 10 percent to their daily limit. While Taiwan’s Foxconn, for instance, the world’s top contract electronics assembler, and contract chipmaker TSMC rose three and four percent respectively.

Despite the rise in shares, some analysts are skeptical about what this change of heart from the Trump administration means for the company.

“The White House’s apparent U-turn ... is unlikely to give Huawei the products it really needs,” said Richard Windsor, founder of independent research firm Radio Free Mobile, adding that “even if it did, it is quite possible that fatal damage has already been done to Huawei’s smartphone business.”

Huawei had been blacklisted in May amid trade tensions between Beijing and Washington, as U.S. government blocked tech firms from doing business with the Chinese giant. The sanctions also prevented it from selling network equipment to U.S. telecom companies. Huawei has denied its products pose a security threat, despite the U.S. alleged accusations that it poses a threat to national security. 

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