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Nearly 50 economies join US initiative aimed at limiting Chinese firms

Mr Krach says Huawei could run out of chips for much of its hardware by sometime next year, after restrictions are placed on its access to crucial technology.


THE United States has brought 49 economies, representing two-thirds of global economic output, into its "Clean Network" initiative aimed at limiting Chinese companies from access to sensitive sectors, such as cloud computing and 5G mobile networks, a senior administration official said.

Restrictions on companies such as Huawei Technologies, which the US says is beholden to China's Communist Party and presents a national-security risk, have limited Huawei's access to crucial technology, and the US believes it could run out of chips for much of its hardware by sometime next year, said Keith Krach, undersecretary for economic growth, energy and the environment.

"Countries and companies are more and more asking the question, 'Who do we trust?'" he said on Thursday. "The answer's coming back, it's certainly not Huawei because they're the backbone of the Chinese Communist Party's surveillance state."

Mr Krach has been the leading advocate of Secretary of State Michael Pompeo's push to banish Chinese technology in systems around the world, as part of a broader administration effort to constrain China's global ambitions.

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He recently visited Taiwan and toured European nations, as well as the Middle East to secure commitments from more governments to join the US effort.

"The success of the Clean Network has taken all the momentum away from Huawei," he said. "When we looked at this six months ago it looked like Huawei was unstoppable."

China's embassy did not immediately respond to a request for comment on Friday. Huawei has repeatedly rejected claims that its technology compromises US national security.

Huawei has told Chinese wireless operators that its component inventory can support base station construction in 2021 and beyond despite US sanctions.

Rotating chairman Guo Ping said last month the company has "sufficient" inventory for its communications equipment business, but consumer business chief Richard Yu said in a recent presentation that Huawei is suffering from what he called an unfair US ban. BLOOMBERG

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