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Huawei security chief says U.S. actions won't limit global footprint

Akiko Fujita

Huawei’s U.S. security chief says American attempts to cripple the Chinese telecommunications giant will do little to minimize its global footprint. Chief Security Officer Andy Purdy told Yahoo Finance that the Trump administration’s actions to restrict Huawei’s access to American companies will do more damage to U.S. suppliers than to Huawei.

“We will be able to maintain our operations globally,” Purdy said. “Whether we can do it in exactly the same way, I can’t assure that.”

The Commerce Department moved to place Huawei and its affiliates on an “Entity List” Wednesday, effectively banning it from doing business with American companies. The action forces U.S. suppliers to apply for licenses in order to continue selling to the Shenzhen-based firm, significantly limiting access to a market that accounted for $16 billion of its $70 billion procurement budget last year, according to a Huawei spokesperson.

Still, Purdy said the company remained open to discussions with administration officials, to address security concerns that have been at the center of Washington’s ongoing fight with Huawei.

“We hope that we will be given the opportunity to talk to the U.S. government about what kinds of risk-mitigation measures that can be put in place that will make America safer and allow us to do business and maintain the jobs of our customers,” Purdy said. “But we have no false optimism or no false hopes.”

The Trump administration has pushed U.S. allies to ban Huawei equipment from their mobile infrastructure, saying its close ties to the Chinese government pose a national security risk. While Australia, New Zealand and Japan have followed suit, European allies have opted to continue using Huawei’s equipment, with additional security layers in place.

Huawei’s tensions with Washington have coincided with a year-long U.S.-China trade battle that has resulted in tariffs on Chinese and U.S. goods. Earlier this month, President Trump hiked tariffs on $200 billion in goods from 10% to 25%, citing broken promises by Beijing. That prompted China to retaliate with a 25% tariff on $60 billion worth of U.S. imports.

But U.S. Commerce Secretary Wilbur Ross insisted his department’s actions were unrelated to the trade war, telling Bloomberg that it was instead part of “an enforcement action” brought forth by the agency’s Bureau of Industry and Security. He said the Chinese Embassy in Washington was notified of the impending designation before the department announced it.

Asked whether the Trump’s executive order and the Commerce Department’s decision represented a broader attempt to drive Huawei out of the U.S., White House Press Secretary Sarah Sanders said, “Our goal is to protect American interests, American entities.”

Analysts say Washington’s actions could have implications beyond the U.S. Huawei relies on American suppliers, including Qualcomm, Intel, and Oracle for semiconductors and software. An inability to buy from them could result in product delays for telecommunications equipment that is more widely used in regions such as Europe.

But Purdy said Huawei is well positioned to weather the storm. Last year, the company announced it would seek to diversify its network of suppliers to minimize potential damage to the company in anticipation of stricter measures from the U.S. and its allies. It has also spent years investing in developing its own chips, though Purdy said the company had not given up on its network here.

“We believe that the American suppliers are among the best in the world, and we hope that we and the suppliers can find a way where we can continue to buy,” he said.

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