Huawei blacklisted by U.S. starting Friday

Trump has signed an executive order to ban foreign telecoms equipment

The announcement that Huawei would be put on the Commerce Department's entity list took tech companies by surprise and many are now scrambling to figure out what that will mean for their operations.They argue a move to cut off Huawei from American technology sales would further decouple us firms from the global technology supply chain and end an important revenue stream.

In a different move, President Donald Trump signed an executive order on Wednesday barring American companies from using telecommunications equipment made by firms labeled as security risks.

According to an excerpt of the executive order, Trump has declared a national emergency due to the threat presented by foreign telecommunications equipment. The US Commerce Department said it was adding Huawei and 70 of its affiliates to its "Entity list", which compiles individuals, companies and organisations that are seen as posing a risk to US national security.

USA companies were prohibited from selling parts and components to ZTE for about two weeks, before the Commerce Department issued a series of temporary general licenses that allowed the company to continue to do business with US suppliers, until it agreed to a plea deal a year later.

"China will take all the necessary measures to resolutely safeguard the legitimate rights of Chinese firms".

For the past 10 years, American officials have warned that using Huawei technology is a national security risk.

Huawei Technologies Ltd., the biggest global maker of switching equipment for phone companies, has spent a decade fighting accusations it facilitates Chinese spying.

Sir Richard said the government - which has been seeking to build economic links with China - should not be influenced by fears of economic reprisals by Beijing if Huawei is excluded.

At the same time, the US Commerce Department announced an effective ban on US companies selling or transferring US technology to Huawei.

As Huawei and its market breadth grew, so did USA concerns that China's one-party security state could use Huawei networks for espionage or cyber attacks.

A range of Asian and European suppliers would also be hurt if Huawei was forced to curb production, while telecom carriers that rely on Huawei, and have largely resisted US calls to bar the company, would be left scrambling just as countries race to roll out next-generation 5G mobile networks.

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And that's what the commerce department is doing to Huawei under the act.

The moves expand a trade war between the U.S. and China. "But if we don't have access to the customer data, we can't send it back to China".

The order doesn't mention Huawei or China by name, but it was widely seen as targeting Huawei and other Chinese companies such as ZTE.

Companies like Huawei need their US suppliers, since Chinese manufacturers account for about only 3% of worldwide chip production, according to an estimate by Sanford C. Bernstein & Co. Inc.

The pain for Huawei's supply chain would be redoubled if the trade war put a damper on the Chinese technology industry.

Canada has also been dragged into the spat after arresting Huawei's chief financial officer Meng Wanzhou in December on a United States extradition warrant related to Iran sanctions violations. In addition, Huawei's founder, Ren Zhengfei, responded to the inclusion of the company in the "list of entities".

The US has pressured allies to shun Huawei in their next generation 5G mobile networks.

"Assuming the USA export ban on Huawei remains unresolved for the next 12-24 months, we highly doubt if China would stick to its timetable of building 5G aggressively", the USA brokerage wrote.

It will be tough for Huawei too, the person said, noting none of its US suppliers "can be replaced by Chinese ones, not within a few years, at least".

As negotiations towards resolving the U.S.

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