'The Chinese government would not sit there and watch Huawei being slaughtered. I believe there would be counter-measures,' Eric Xu, rotating chairman at Huawei, told CNBC, amid reports the U.S. was preparing new restrictions against the tech giant.
Reuters reported that senior officials in the Trump administration have drawn up new rules that could hurt the supply of chips to China's Huawei.
Beijing will not sit and watch Huawei get "slaughtered" and could retaliate if there are further sanctions on the Chinese technology giant, a top Huawei executive told CNBC on Tuesday.that suggested senior officials in the Trump administration had drawn up new rules that would require chipmakers to obtain a license if they use American equipment to make components sold to Huawei.
The U.S. has argued that 5G equipment from China could be a national security risk. Xu argued that China could use that same logic for American devices using U.S. chips and block them from the Chinese market. This new rule change aims to choke off supply to Huawei where it hurts. The company doesn't manufacture its own chips. Instead, it designs them and they are made by TSMC. If Huawei gets cut off from that supply, it could be quite damaging. Such a change would be an escalation of tensions between the U.S., Huawei and ultimately China.
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