Business / Tech

Trump declares emergency barring U.S. firms from business with foreign telecoms deemed security risks


President Donald Trump declared a national emergency Wednesday barring U.S. companies from using foreign telecoms equipment deemed a security risk — a move that appeared aimed at Chinese giant Huawei.

The order signed by Trump prohibits purchase or use of equipment from companies that pose “an unacceptable risk to the national security of the United States or the security and safety of United States persons.”

Federal Communications Commission Chairman Ajit Pai applauded Trump’s executive order, saying it will safeguard the U.S. communications supply chain. “Given the threats presented by certain foreign companies’ equipment and services, this is a significant step toward securing America’s networks,” he said.

A senior White House official insisted that no particular country or company was targeted in the “company- and country-agnostic” declaration.

However, the measure — announced just as a U.S.-China trade war deepens — is widely seen as prompted by already deep concerns over an alleged spying threat from Huawei.

U.S. officials have been trying to persuade allies not to allow China a role in building next-generation 5G mobile networks, warning that doing so would result in restrictions on sharing of information with the United States.

U.S. government agencies are already banned from buying equipment from Huawei, a rapidly expanding leader in the 5G technology.

China’s government is furious.

“For some time, the United States has abused its national power to deliberately discredit and suppress by any means specific Chinese enterprises, which is neither honorable nor fair,” Foreign Ministry spokesman Geng Shuang said.

“We urge the U.S. side to stop the unreasonable suppression of Chinese enterprises on the pretext of national security and to provide a fair and non-discriminatory environment,” the spokesman said.

Earlier, David Wang, executive director of Huawei’s board, shrugged off news of the upcoming emergency declaration.

“Our business in the U.S. is not very big. We are a company with global operations, so if there is this or that change in any country, the impact on our global business is very little,” he said.

The U.S. portrayal of Huawei as a national security danger dovetails with Washington’s wider complaint that Chinese companies are unfairly protected by the state, making fair trade impossible.

On an even broader scale, the United States and some European allies fear that Chinese economic expansion, particularly in the “Belt and Road” global infrastructure program, is part of a bid for geopolitical dominance.

Amid those worries, Huawei is portrayed as an especially potent Trojan horse that could leverage its ultra-rapid telecoms technology into a Chinese government spy network reaching deep into American society and business fields.

“Chinese telecom companies like Huawei effectively serve as an intelligence-gathering arm of the Chinese Communist Party,” Sen. Tom Cotton, from Trump’s Republican Party, said after Trump’s emergency declaration.

“The administration is right to restrict the use of their products.”

Early this year, the Justice Department unsealed criminal charges against Huawei, a top company executive and several subsidiaries, alleging the company stole trade secrets, misled banks about its business and violated U.S. sanctions. The sweeping indictments accuse the company of using extreme efforts to steal trade secrets from American businesses — including trying to take a piece of a robot from a T-Mobile lab.

The executive charged is Huawei’s chief financial officer, Meng Wanzhou, who was arrested in Canada in December. The U.S. is seeking to have her extradited.

Still, so far, the U.S. campaign to lobby other countries to turn their backs on Huawei has had mixed results.

Even the British government, one of Washington’s closest allies, is mired in debate over whether to follow the U.S. lead or allow Huawei’s proven expertise in developing the 5G capacities.

On Tuesday, Liang Hua, the chairman of the company, visited London to insist that Huawei will “commit ourselves, to commit our equipment to meeting the no-spy, no back-door standards.”