The US government will soon issue licenses allowing a select few American companies to supply goods to Chinese telecommunications equipment maker Huawei, The New York Times cited people familiar with the matter as saying on Wednesday.

Why it matters: The move could cool tensions between the US and China as another round of high-level trade talks start in Washington today, though the Trump administration ruled earlier this week that more Chinese tech firms would join Huawei on the US trade blacklist.

  • The ban on Huawei hasn’t technically gone into effect as the administration issued a 90-day reprieve on August 19 to allow some exports to Huawei to continue.

Details: In a meeting last week, President Trump gave the green light to begin approving licenses for some American companies to bypass a ban placed on Huawei in May. The restrictions effectively barred US companies from doing business with the Chinese firm.

  • The Huawei supplies will be limited to nonsensitive goods, or so-called general merchandise, said the report.

Context: Despite repeated denials, the Trump administration has been using the Huawei situation as a bargaining chip in its ongoing trade conflict with China.

  • In August, the administration officially barred US government agencies from buying telecoms equipment from Huawei soon after trade talks in July failed to produce a deal.
  • Trump made a similar announcement in late June that American companies would be permitted to resume sales to Huawei after his administration reached an agreement with China to resume trade negotiations.

Wei Sheng

Writing about semiconductors and telecommunications.

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