Tag: United States

Source: BBC

The US government has added a dozen more Chinese companies to its restricted trade list, citing national security and foreign policy concerns.

Washington says that some of the firms are helping develop the Chinese military’s quantum computing programme.

This latest move comes as tensions grow between the US and China over the status of Taiwan and other issues.

Trade was among the items discussed at a virtual summit between the leaders of both countries earlier this month.

Eight Chinese-based technology firms were added to the so-called “Entity List” for their alleged role in assisting the Chinese military’s quantum computing efforts and acquiring or attempting “to acquire US origin-items in support of military applications”.

This entity list has increasingly been used for national security reasons since the previous Trump administration.

The US Commerce Department also said 16 individuals and entities operating in China and Pakistan were added to the list due to their involvement in “Pakistan’s unsafeguarded nuclear activities or ballistic missile program.”

A total of 27 new entities were added to the list from China, Japan, Pakistan, and Singapore.

Separately, the Moscow Institute of Physics and Technology was added to the department’s military end user list, although the listing gave no more details other than it had produced military equipment.

The new listings will help prevent American technology from supporting the development of Chinese and Russian “military advancement and activities of non-proliferation concern like Pakistan’s unsafeguarded nuclear activities or ballistic missile program,” Commerce Secretary Gina Raimondo said in a statement.

Potential suppliers to firms on the list will now need to apply for a licence before they can sell to them, with applications likely to be denied.

Chinese telecoms giant Huawei was added to the list in 2019 over claims that it posed a risk US national security.

The move cut it off from some of its key suppliers and made it difficult for the company to produce mobile phones.

The Chinese government has previously denied that it takes part in industrial espionage.

By Arjun Kharpal for CNBC

For decades, some within Britain and the US have celebrated a “special relationship” — historically, politically, economically and culturally. That bond looks set to be challenged after the U.K.’s decision to allow Chinese telecommunications giant Huawei to take part in its next-generation mobile networks.

Known as 5G, those networks promise super-fast data speeds but also provide the technology to underpin critical infrastructure in the future.

Washington has maintained that Huawei represents a national security threat because its networking gear could be used by the Chinese government for espionage. The Trump administration has also raised concerns about the link between Huawei and the Chinese Communist Party. Huawei has denied that its equipment could be compromised and says it has no links with Beijing.

The U.S. piled pressure on the U.K. to block Huawei. Secretary of State Mike Pompeo said Britain had a “momentous decision ahead on 5G.” But Britain chose to allow Huawei to participate in parts of 5G networks called the Radio Access Network. This is essentially the part of the network that hooks up your devices with the actual 5G signal. Huawei can participate in the RAN, but no more than 35% of a single vendor’s equipment in this part of the network can come from the Chinese vendor.

Britain’s decision has “disappointed” the Trump administration and now U.S. lawmakers are warning about deteriorating relations between the U.K. and U.S.

“Here’s the sad truth: our special relationship is less special now that the U.K. has embraced the surveillance state commies at Huawei,” Sen. Ben Sasse, R-Neb., who is a member of the Senate Select Committee on Intelligence, said in a statement on Tuesday.

“The Chinese Communist Party has infected Five Eyes with Huawei, right at a time when the U.S. and U.K. must be unified in order to meet the global security challenges of China’s resurgence.”

Five Eyes refers to an intelligence-sharing alliance involving Australia, Canada, New Zealand, the United Kingdom and the United States. British Foreign Secretary Dominic Raab suggested that intelligence sharing was not at risk.

Intelligence-sharing at risk?
“This decision is deeply disappointing for American supporters of the ‘Special Relationship’. I fear London has freed itself from Brussels only to cede sovereignty to Beijing,” Sen. Tom Cotton, R-Ark., tweeted, referring to Britain’s exit from the European Union.

“The short-term savings aren’t worth the long-term costs. In light of this decision, the U.S. Director of National Intelligence should conduct a thorough review of U.S.-UK intelligence-sharing,” he added.

Earlier this year, Cotton introduced a bill that would stop the U.S. from sharing intelligence with countries that use Huawei equipment for their 5G networks.

But analysts said this was unlikely to happen.

“It is highly unlikely that the U.S. will follow through with threats to cut off or curtail intelligence sharing over the U.K. decision,” Paul Triolo, practice head for geotechnology at Eurasia Group, told CNBC.

“The U.K. has tried to carefully balance the economic and security concerns around Huawei and 5G by raising the bar substantially on vendor and carrier security posture, while restricting high-risk vendors from key portions of the network. It is more likely the U.S. will work with the U.K. government to ensure high security standards are met. Blowing up the Five Eyes intelligence sharing partnership over this is just not on the cards.”

Trade deal complications?
The decision comes as as Britain heads toward Brexit on Friday when it will officially leave the European Union.

The U.K. is working toward striking a trade deal with the EU and the U.S. U.K. Finance Minister Sajid Javid said earlier this month that striking an agreement with the U.S. is “a huge priority for us,” and that the two nations have “already started working closely together (toward that goal).”

But experts said, with Brexit around the corner, that the Huawei deal could complicate trade negotiations.

“I think the tone coming out of Washington is one of unhappiness — but hasn’t totally condemned it, leaving a middle road potentially to do some kind of deal down the road,” said Neil Campling, head of technology, media and telecoms research at Mirabaud Securities.

“However, from Saturday (aka post Brexit) the U.K.’s bargaining position on trade deals with any potential partners is weakened, and so the U.S. may well be waiting to tactically and aggressively ramp up the heat at a later time. Nothing is certain at this juncture,” he told CNBC.

At the same time, Britain has to think about its relationship with China, one of its key partners. In December, Wu Ken, China’s ambassador to Germany, threatened Europe’s largest economy with “consequences” if it blocked Huawei. This could have been in Britain’s mind too.

Campling said there was “never a perfect solution” to Britain’s Huawei decision given the competing interests. And Lew Lukens, former deputy chief of mission of the U.S. Embassy in London, said British Prime Minister Boris Johnson is trying to balance the competing sides.

“I think Boris Johnson is laying down a marker in some ways saying, ‘I’m not going to do what Donald Trump says, we are going to forge our own path and balance these competing interest,’” Lukens told CNBC. “I think he’s confident they can keep the U.S. on the same side and these other markets on the same side.”

US set to abandon net neutrality rules

US Federal Communications Commission chairman Ajit Pai will propose vacating Barack Obama-era net neutrality rules, according to a person briefed on the development that will hand a victory to broadband providers such as AT&T and Comcast that oppose the regulations.

Pai’s proposal is to be presented to fellow FCC commissioners on Tuesday ahead of a vote set for 14 December at the agency, where the chairman — an appointee of President Donald Trump — leads a Republican majority. Pai will seek to vacate the rules adopted in 2015, retaining only a portion that requires broadband providers to explain details of the service they are offering, said the person briefed on the matter, who asked not to be identified because the proposal isn’t yet public.

Rules to be set aside include a ban on blocking or slowing Web traffic, and a prohibition on offering “fast lanes” that give quicker service to content providers willing to pay extra. Broadband providers have argued that competition will ensure they don’t unfairly squelch traffic.

Tina Pelkey, an FCC spokeswoman, declined to comment.

Pai’s proposal is the latest step in a years-long tug-of-war over regulations dictating how companies such as AT&T and Comcast allow access to Internet content — from Facebook’s social media site to Netflix’s streaming videos.

Supporters including Silicon Valley firms argue the rules are needed to keep network owners from favouring their own content and discouraging Web start-ups. Critics say the rules discourage investment while exposing companies to a threat of heavier regulation including pricing mandates.

The regulation survived a court challenge from broadband providers last year. Previous attempts by the FCC to pass such rules ended with courts tossing them out or sending them back to be rewritten.

By Todd Shields for Bloomberg on Tech Central

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