The massive telecom company out of China, the largest in the world in fact, has filed a lawsuit against the US government asking that the courts throw out a portion of the US military appropriations act that bars the government and it contractors from using Huawei equipment. The US government has said that the firm is a security risk – Huawei filed a legal action in Plano, Texas. Note that Huawei is the first global brand out of China and it has been building its business platform from Australia to Japan to Europe. But some of these countries, like the US, are saying that they feel that the Chinese firm is a serious security risk and that they all, in some cases driven by pressure delivered by the US government, are fading away or reconsidering the usage of equipment from the biggest telecom manufacturer in the world.
Now Washington has pressured its allies to shun Huawei and some say that this will disrupt fifth-generation equipment of 5G equipment usage around the world. The US seems to be using a blocking tactic as it buys time to play catch-up with the world leader Huawei. In a related matter the firm ZTE Corporation, another Chinese maker has been told by some buyers that they are not willing to purchase this equipment after all – again the US is behind this blocking tactic as well.
The US and China are in trade talks but there are growing concerns that cyber -spying is growing and the US has made it clear that it will act to stop this spying. Many EU members are now, like the US, refusing forced technology transfer that China has demanded over the past two decades. The upcoming US trade solutions are being hyped but we at Classiarius believe that talks will fail and the US will be forced into a fall trade war with China.
More on this topic in the coming weeks – trade talks will fail.