Huawei banned from the US Creates a Chain Reaction of Negative Effects

Huawei
Huawei

Huawei Techonologies, one of the biggest telecommunications equipment manufacturer in the world, was blacklisted from conducting business in the United States of America. The China powered company made waves in the world market last Monday when the decision came out. Global technology stocks were buzzing nonstop as investors recalculated and set a new price list for major suppliers to Huawei Technologies and even Huawei itself.

Numerous reports from various media outlets, both traditional and digital, have stated that powerhouse company, Google, has put a stop to doing business with Huawei Technologies. Since the controversial announcement, Google has limited Huawei’s access from very critical points of its mobile platform, called an android. This deals a deathblow for the telecoms equipment manufacturer as it inhibits their rapid global expansion plans. This thwarted their efforts and plans to actively sell new models of the phone outside of China.

Being the 3rd biggest maker of handset devices in the world, these critical decisions have put a damper on their global expansion efforts in marketing the brand. On top of that, Bloomberg announced that several US companies have pulled out from supplying Huawei with their parts or components needs. Xilinx, Intel, Qualcomm, and Broadcom have all ceased their relationship with Huawei.  

Never the less, Huawei remains resolute. A company spokesman has stated that their company has made significant contributions and gains for the benefit of the Android’s growth and improvement around the world. The company vows to continue what they do in spite of the setback. They promised to make continuous security updates and after sales services to honor existing users and to prove they have a right to be in the top spot.  

Qualcomm felt the sanctions on Huawei, with their company stock being marked. 5.5 percent lower in the trading floor. Micron Technology, the ones that make chips for the phones, also suffered the same grave consequences. Their revenue was marked 3.77 percent lower when the news was announced.  In the same token, Applied Material slipped by .53 percent because of this move by the US government.

Similarly, STMiElectornics and Infineon, both European chip supplies were also impacted by the US black list decision. They fell 7% and 5% in the trading floor. The region’s biggest chip maker, was thus, forced to stop its shipments to Huawei. On the other hand, competitors such as Ericsson and Nokia, have taken advantage of the situation to make gains for their own companies. Even Samsung was able to benefit from this event with their stock rising by 1.94%.

The Commerce Department said last that it’s verdict to put Huawei on the banned list would preserve American technology. It would also prevent foreign entities like Huawei from potentially undermining the country’s national security. China’s Foreign Ministry protests the decision and deemed it as disgraceful and unjust considering they are willing to work with the government to make necessary modifications to keep their devices and programs safe. Moreover, Huawei asserts this damages the mutual trust and collaboration between nations and puts many Americans at a risk for losing their jobs.

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