US pressure on its suppliers means that Huawei’s HiSilicon chip division has been unable to get the supplies it needs to keep making chipsets.
Washington is continuing to exert pressure on governments around the world to sever ties with Huawei, claiming that the company is handing over data to the Chinese government – accusations of spying that the company has consistently denied.
Back in May, the US passed regulations that required suppliers of software and manufacturing equipment to refrain from doing business with Huawei without first obtaining a licence.
While Huawei has invested heavily in the chip sector, HiSilicon’s Kirin processors rely on software from US companies Cadence Design Systems and Synopsys to design its chips and uses TSMC to produce them.
These trade restrictions are not just impacting Huawei, however. US companies have been lobbying the US government to revoke these restrictions, among them Qualcomm which wants to be able to sell chips to Huawei for inclusion in its 5G phones.
The US decision is certainly damaging Huawei but it’s not without consequences for US companies who are losing billions of dollars, as a result, and ceding a key foreign market to their competitors.
