US Designates China’s Huawei, ZTE as National Security Threats

The United States Federal Communications Commission designated Tuesday Chinese telecommunications companies Huawei and ZTE as national security threats, cutting them off from around US$8.3 billion in federal broadband subsidies.

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"We cannot and will not allow the Chinese Communist Party to exploit network vulnerabilities," FCC Chairman Ajit Pai said in a statement despite both companies having repeatedly denied that they are threats to U.S. national security.

Back in November 2019, the agency voted unanimously banning telecommunications manufacturers it deemed to be threats from receiving money meant to expand internet access to underserved areas, including the rural parts of the U.S. Yet the final order went into effect Tuesday. 

Huawei and ZTE did not immediately respond to requests for comment. 

As a new chapter in the trade war with China starts, on Monday, the U.S. also blocked the export of high-tech products to Hong Kong a day before the Chinese government signed off on a new national security law.

While the FCC has taken an increasingly hard line against Chinese firms. In April, the agency said it may shut down U.S. operations of three state-controlled Chinese telecommunications companies. 

In May 2019, U.S. President Donald Trump signed an executive order declaring a national emergency and barring U.S. companies from using telecommunications equipment made by companies posing a national security risk. 

And by the end of June, Huawei became the main target of Trump's trade war against China after Washington blacklisted the firm, prohibiting it from selling its equipment to U.S. firms. This unilateral economic sanction was executed because the Chinese company and its 5G technology supposedly represent threats to U.S. national security.