WASHINGTON – On Wednesday, President Trump issued a ban on American telecommunications companies installing foreign-made devices that could pose a threat to national security, White House officials told leading network companies.
Mr. Trump issued an order to Trade Minister Wilbur Ross to prohibit transactions that "pose an unacceptable risk," but did not exclude any nation or company. The action was long awaited and is the latest achievement in the government's economic and security dispute with China. It is also the most extreme move in the Trump government's fight against the Chinese technology sector.
The Ministry of Commerce will set the rules for reviewing transactions that will be banned in the next 150 days, officials said. The order is for future business, not retroactive. The Commerce Department announced that it would work on the new rules in consultation with the Attorney General, the Minister of Finance and other officials throughout the administration.
The ruling left many questions open, including how the Commerce Department will define foreign adversaries and set criteria to prohibit companies from selling equipment to the United States. The executive action did not address concerns of rural airlines that the order would hit them particularly hard. Some of them rely on devices that already contain parts from Huawei and other Chinese companies.
Mr. Trump declared the threat posed by foreign opponents in American telecommunications networks a national emergency imposed by a law that imposed sanctions on states such as Iran and Russia.
Under the leadership of Secretary of State Mike Pompeo, American officials have been warning for months that allies before the United States would cease to pass on information when using Huawei and other Chinese technologies to build the core of their 5th generation (5G) networks. The networks promise not only a faster mobile service, but also the connection of billions of "Internet of Things" devices – such as autonomous cars, security cameras and industrial equipment – to a new Internet architecture.
Pentagon and US intelligence officials have warned Chinese companies could control the networks, fearing that secure messages might not only be intercepted or secretly diverted to China, but that the Chinese authorities might order Huawei to shut down the networks during a conflict, which would put them at risk American infrastructure would be disrupted as gas pipelines and cellular networks.
Huawei has denied the allegations, and his executive director said he would shut down the company rather than obeying the Chinese government's instructions to intercept or redirect Internet traffic. American officials say he has no choice: according to Chinese law, the country's companies must obey the instructions of the Ministry of State Security.
Mr. Trump was deeply involved, quietly meeting American telecommunications managers in the White House and weighing up different versions of the executive order. He insisted that the United States "win" the 5G competition just to find out that no American companies are setting the main course for 5G Internet traffic.
The executive order came in an escalating trade war between the United States and China, with the two sides paying hundreds of billions of dollars in tariffs in recent days. Mr. Trump has indicted the Chinese government for unfair trading practices and announced higher tariffs on Chinese goods worth $ 200 billion last week.
But few issues have received as much support from the parties in Washington as the Trump warnings of Huawei and ZTE's security threats, another company with close ties to the Chinese government. The calls have become so fierce that some have warned of a new red horror, and Chinese officials said the United States has gone to paranoia beyond measure.
Major mobile phone manufacturers have renounced the use of Huawei devices in their 5G systems However, the order will ensure that smaller rural telecommunications companies avoid Huawei from building new networks.
With 5G systems featuring high-speed, short-range devices, the technology is currently more suitable for urban areas than rural areas. However, Huawei continues to appeal to rural networks, as they are cheaper than alternatives.
The ban could also help the Trump administration bring European allies to block Huawei. Some allies had asked why they should block Huawei if the US had not. Other European officials have suggested that Mr Trump will soften or lift the ban under a trade agreement with China. Most of the big allies have resisted the Trump government's move, with the exception of Australia, which Huawei banned last summer.
The White House, intelligence officials and lawmakers of both parties argue that China has already shaped its telecommunications industry and that the tech industry has also boosted inside China's face recognition, constant population surveillance and human rights abuses.
American officials have also warned that China's exports of Huawei and other technical products have enabled other authoritarian nations to spy on their citizens and gain access to sensitive security and trade secrets.
"We need to have a clear idea of the threats we face and be prepared to do the necessary to counter these threats," Ajit Pai, chairman of the Federal Communications Commission, said in a statement. "Today's executive order does just that."
But even if Huawei is banned from the US, probably 40 to 60 percent of the world's networks are controlled. It has achieved a strong marketing pitch in Africa, Latin America and parts of Asia, where it has tremendous economic influence. American officials said China offered subsidized prices and low-interest loans to outsmart its few western competitors, mainly Nokia and Ericsson.
The United States Must Connect With These Nations – And Must Prepare for a Day As the US government and business have to live in "dirty networks," Sue Gordon, deputy director of the National Intelligence Service, recently warned.
In January, prosecutors in Washington state accused two Huawei units of conspiring to steal T-Mobile trade secrets and cable fraud information.
Senator Lindsey Graham, Republican of South Carolina and Chairman of the Senate Judiciary Committee, doubted that Chinese companies could comply with American standards and surveillance laws.
"There is no way to hell, China can meet these criteria because of the way they are governed," Graham said at a hearing this week. "China can only meet the criteria if it is no longer China."
The Federal Communications Commission is considering rules prohibiting broadband providers receiving federal grants to use Huawei or ZTE devices on their networks. The largest American carriers have little equipment from the companies, but some rural telecommunications providers have expressed concerns about how they could rid their Chinese networks of products containing parts from different equipment manufacturers.
The Commission recently approved an order that prevented China Mobile Limited from offering services in the US. The agency said it is investigating similar regulations against China Unicom and China Telecom Corporation.