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Xinhua Headlines: Restricting Huawei backfires on U.S. intere

Last Updated: 2019-05-25 09:24 | Xinhua
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 BEIJING, May 24 (Xinhua) -- Millions of Americans in rural areas may be denied access to faster and lower-priced broadband connections because of Washington's restrictive moves against Huawei, a Chinese company which has offered equipment to U.S. rural telecom operators for years.
 
The U.S. government last week announced it would "prohibit transactions posing an unacceptable risk" to the country by declaring a national emergency over what it claimed are technological threats, and announced restrictions on the sale and transfer of U.S. technologies to Chinese company Huawei.
 
The ban would force small and independently-owned telecom operators such as Eastern Oregon Telecom and Union Wireless in Wyoming to spend their limited funds buying more expensive gear from Huawei's competitors, according to an article in The New York Times by Chen Lifang, Huawei's group board director.
 
Though accusing Huawei of being able to use its network equipment to spy on foreign nations for the Chinese government, the U.S. government has not produced any hard evidence to support its accusation. However, innocent victims in the global chains of the telecom industry would bear the consequences.
 
BACKFIRE ON U.S. INTERESTS
 
"A ban will not make American networks more secure. Instead, it will hurt ordinary Americans and businesses by denying them access to leading technology, reducing competition and increasing prices," Chen said in the article.
 
"The ban will financially harm the thousands of Americans employed by the U.S. companies that do business with Huawei, which buys more than 11 billion U.S. dollars in goods and services from U.S. companies each year," said Chen. "A total ban on Huawei equipment could eliminate tens of thousands of American jobs."
 
The recent U.S. move to add the Chinese telecom company to a trade blacklist has already taken a toll on Wall Street. Shares of Huawei's major suppliers, including Google, Qualcomm and Broadcom, were pressured.
 
Washington's plan has also drawn resistance from domestic telecom carriers, especially those in rural areas, where the optical cable infrastructure is weak and the cost-effective Huawei equipment is considered as a better option.
 
James Kail, chief of LHTC Broadband, a digital service provider in rural Pennsylvania, told Xinhua that the ban could have an adverse effect on their business since they have a significant investment at stake as well as potential funding that could be jeopardized.
 
"About a quarter of small rural U.S. broadband providers use Huawei equipment, which is ... at lower prices and better customer service," Roger Entner, founder and lead analyst at U.S. telecom research firm Recon Analytics, told Xinhua via email.
 
Banning Huawei in the United States has the Federal Communications Commission (FCC) in a conundrum, Entner tweeted. "Is the FCC going to accept slower broadband build-out?"
 
GROUNDLESS ACCUSATION
 
According to some German media, after years of review, Britain, Germany and the European Union failed to find any backdoor in Huawei products.
 
Chinese Foreign Ministry spokesperson Lu Kang said in response that "the conclusions of Europe's scrutiny have proven Huawei innocent, and showed the U.S. suppression against other countries' enterprises with state power is unjustified."
 
"We'd like to see the U.S. comment on the findings," Lu said at a press briefing, adding that since the coming into light of the U.S. secret surveillance program Prism, the United States has remained silent over evidence alleging its illegal practices of cyber attacks and thefts.
 
Likewise, the 2019 annual report compiled by the Huawei Cyber Security Evaluation Center Oversight Board, staffed by representatives from Huawei and Britain's government including the National Cyber Security Centre (NCSC) and telecommunications sector, detailed concerns about Huawei's software engineering capabilities, but stated that the "NCSC does not believe that the defects identified are a result of Chinese state interference."
 
Such conclusions came as a result of putting Huawei under a microscope.
 
"I don't think any of the other vendors have been on such level of scrutiny to find out whether or not security risks exist in their software," Stephane Teral, technology fellow and advisor for Mobile Infrastructure and Carrier Economics at the consultancy IHS Markit Technology, told Xinhua.
 
The United States has also been unsuccessfully trying to rally other countries to abandon Huawei products, citing security threats.
 
"Our perspective is not to block Huawei or any company," French President Emmanuel Macron told the VivaTech conference in Paris.
 
The Department of Information and Communications Technology of the Philippines said that there was no incident of a national security breach from the local telecommunication network using Huawei equipment.
 
Major Malaysian mobile operators like Maxis, Celcom and U Mobile also said their cooperation with Huawei is not affected by the recent U.S. ban.
 
"ECONOMIC BULLYING"
 
With the use of state power, Washington's groundless crackdown on Chinese private company Huawei is typical "economic bullying," Chinese State Councilor and Foreign Minister Wang Yi said.
 
Such an egocentric approach by the United States will not win the recognition and support of the international community, said Wang.
 
Blameless companies around the world, including Huawei's U.S. suppliers, could lose business, face disruptions and incur significant new costs, while China will only redouble its efforts to produce advanced technologies domestically, according to an editorial article published by Bloomberg.
 
As Huawei is deeply embedded in the global supply chain, "there might be other manufacturers that will be caught up in it," Foad Fadaghi, an Australian technology analyst and managing director of Telsyte, was quoted by local media as saying.
 
The U.S. restrictions on Huawei would also hold back the launch of 5G networks and earnings of the tech sectors across the world, Swiss leading investment bank UBS said in its latest research report.
 
The Huawei ban in the long term "would also make network equipment more expensive because it could reduce the number of suppliers in what is already a small pool," according to Standard Investment Bank's note on Kenya's telecom operator Safaricom.
 
In response to the U.S. restrictions, Ren Zhengfei, founder and president of Huawei, said Huawei had recently received widespread global support.
 
Huawei never wants to "walk alone" in the global markets, but has made good preparations for any extreme circumstances, he said.
 
Ren also appreciated the support of a large number of U.S. components suppliers over the years, and they were also lobbying for the easing of U.S. government-imposed restrictions.
 
"As long as the U.S. government allows U.S. companies to export the components, Huawei will continue to buy while sticking to its own research and development," he said.
 
(Xinhua reporters Zhou Zhou in Washington, Ma Qian, Yang Shilong and Pan Lijun in New York, Wang Zichen in Brussels, Yuan Mengchen in Manila, Lin Hao and Jonathan Edward in Kuala Lumpur, Wang Xiaopeng in Nairobi, Guan Jianwu in Bishkek and Hao Yalin in Sydney also contributed to the story.)
 
(Video reporters: Hu Yousong, Liu Jie, Deng Xianlai; Video editor: Zhu Cong)

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