The Trump government agreed to give a new lease to US companies selling to Huawei to ease tensions with Beijing following a rapid escalation of trade war between countries this month.
According to persons familiar with the matter, the US Department of Commerce was preparing to extend a temporary general license for companies to do business with Huawei for 90 days. The announcement is scheduled for Monday. The final details of the extension have not been ironed out, so there may be changes to the announcement that make blanket renewal impossible. The Commerce Department declined to comment.
The decision to allow more time for transactions between Huawei and US companies is likely to be interpreted as an olive branch from Washington to Beijing as they try to resume trade negotiations after a few difficult weeks shaking markets and increasing concern To bring about a global economic slowdown.
Donald Trump, the US president, announced earlier this month that he would impose a new round of tariffs on Chinese imports from September 1
Nonetheless, Mr. Trump expressed concern about the economic impact of the trade war with China when he entered the 2020 reelection. Last week, he said he would postpone the impending introduction of levies on much of China's imports until December to protect the Christmas shopping season from its effects. He also softened his rhetoric against China, saying that he would "have a call soon" with Xi Jinping, the Chinese president, and he expected the trade war to be "fairly short".
The extension of Huawei's time limit, first announced by Reuters, is a win for the business community that has been pushing for more flexibility over the Chinese company.
The Trump administration put Huawei on an export blacklist in May by the Commerce Department after a major round of trade talks with China had been sharply cut short. US officials have accused Huawei of posing a threat to national security, violating US sanctions and espionage.
US technology companies, including Google, whose Android operating system is being used by Huawei, however, quickly demanded latitude in dealing with the ban, arguing that otherwise it would cause serious disruption to their business, their customers and even US security ,
The renewal of the license is a middle ground between the full implementation of the ban promoted by China's hawks in Washington and the total cessation of the ban. Trump has suggested that finding a solution for Huawei could be part of a comprehensive trade agreement with China.
"In many ways, this is not a long-term solution," said Samm Sacks, member of the New America Foundation's Cybersecurity Policy and China Digital Economy Department. "Many in Washington want to kill the company. Others want to use it as a lever. You can not have both, "she added.
High-level US and Chinese negotiators are expected to hold face-to-face talks in Washington in early September, hoping to get better results than the last one in Shanghai Last month, which prompted Mr. Trump to complain about Beijing's failure to comply with the promises and enforce the new bargaining round, but there is no set timetable for negotiations next month.
Trump officials Administration has linked the indulgence of Huawei to Chinese purchases of US agricultural goods, and trade war observers will therefore watch closely as Beijing reacts to its purchases of US agricultural products in the coming days.
A three-month extension of Huawei License would set a new deadline for mid-November approx hr set at the time of the Summit of Economic Cooperation in the Asia-Pacific region in Chile that could provide a new opportunity for the meeting between Mr. Xi and Mr. Trump. During the trade war, the two presidents used international gatherings, including the G20 summit in Argentina last December and the G20 summit in June in Japan, to rekindle the prospect of a deal.