Event Brief – CSIS Debate: “Should the United States severely restrict Huawei’s business?”

Washington, D.C. — On June 28, FAO Global associates attended a debate entitled, “Should the United States severely restrict Huawei’s business?” at the Center for Strategic and International Studies (CSIS). Dan David, Martijn Rasser, Paul Triolo and Erin Ennis provided further insights about the cybersecurity, fraud, infrastructure, business risks and the overall U.S.-China business environment.

Citing national security concerns, U.S. President Donald Trump issued a directive limiting the business activities of Huawei in U.S. Huawei was placed in the “Entities List,” which stops U.S. companies selling products and providing services to Huawei by the U.S. Department of Commerce. Issued later was a “Temporary General License” (TGL), which expires in August and allows firms to provide support for previously concluded business that was implemented by the U.S. Department of Commerce.

Moderator: Scott Kennedy – Senior Adviser, Freeman Chair in China Studies

Featured Speakers- Martijn Rasser – Senior Fellow, Technology and National Security Program, Center for a New American Security, Dan David – Founder, Wolfpack Research LLC, Paul Triolo – Practice Head, Geo-Technology, Eurasia Group, and Erin Ennis – Senior Vice President, US-China Business Council.

3 Key Takeaways

The decision for the U.S. to target an individual company instead of setting a high standard for the general industry is controversial. Panelists argued that it is critical for the U.S. to address the bigger issues in the market. The action of U.S. could also put U.S. companies in similar unfavorable situations in foreign markets.
There exists a possibility that the Chinese government may use Huawei architecture to spy or hack on the U.S. through Huawei products unless Huawei makes its ownership structure transparent. Both CIA and FBI officials suggested that Huawei should not play an important role in U.S. infrastructure.
China is the largest market for the U.S. Although the ban implemented by the U.S. could potentially protect U.S. cyber security concerns, it also hurts the U.S. economy at the same time. To alleviate this situation, U.S. companies should start looking for substitute partners around the world.

Event attended and analyzed by FAO Global Associates Jennifer Hsu and Sophia Song.