China May Restrict Access of U.S. Companies to Technology

Business

China is taking steps to protect its technological advancements, it says, in the latest tit-for-tat in escalating trade tensions with the U.S. The move is seen as retaliation to the U.S. government’s stance against Chinese technologies companies.

Last month the U.S. added Huawei, the giant Chinese smartphone maker, to a blacklist of companies prevented from doing business with the U.S. Google’s parent company, Alphabet, Inc, announced it was discontinuing business with Huawei, as a result.

The move will adversely affect Huawei’s business, it’s believed, as it would bar the company from working directly with the private version of Google’s Android operating system. There are roughly 2.5 billion Android smartphones currently in use the world over.

China responded at the time by saying it would produce its own list of foreign companies it deems to be “unreliable.”

In today’s move, The People’s Daily newspaper, the ruling communist party’s main newspaper, said China will create what it calls a national technological security management list. Under the regulations, a new system will be used to build a strong firewall to protect the country’s innovation ability as well as speed up development of proprietary technologies.

“China … will never allow certain countries to use China’s technology to contain China’s development and suppress Chinese enterprises,” the paper said, referring indirectly to the U.S.

China and the U.S. have negotiating a new trade deal for months. Those talks hit roadblocks last month, however. The U.S. demanded changes in Chinese behavior be codified in Chinese law. The Chinese have called such demands harsh.

But U.S. Treasury Secretary Steven Mnuchin sounded an optimistic note on Sunday, writing on Twitter that he had “candid” talks with his Chinese counterpart, Yi Gang, the governor of the People’s Bank of China. The two were shown smiling and shaking hands as they met during the G-20 finance meeting in Fukuoka, Japan.

Photo by Henozuxj via Wikimedia Commons

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