US could revive plan to ban Huawei from its financial system: report

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huawei US could revive plan to ban Huawei from its financial system: report US News Huawei government
Huawei logo on Sept. 5, 2019 in Beijing. (Image credit: TechNode/Coco Gao)

The Trump administration may reconsider a stalled plan that would ban Chinese telecommunications equipment maker Huawei from the US financial system, Reuters reported on Tuesday, citing a person familiar with the matter.

Why it matters: The potential move could adversely affect Huawei’s overseas businesses, including its telecommunications equipment and smartphone segments, since almost all dollar payments clear through the US banking system.

Details: White House considered adding Huawei to the Treasury Department’s Specially Designated Nationals (SDN) list earlier this year as part of its sanctions against the company, said Reuters citing three people familiar with the matter.

  • The plan was ultimately shelved but one of the sources said it could be reconsidered in the coming months depending on how things go with Huawei.
  • The plan was considered by the White House National Security Council and seen by officials as a nuclear option to sanction Huawei, said two of the people.
  • White House officials drafted a memo and held interagency meetings on the issue, said one person.
  • Entities on the SDN list include Russia’s Rusal, the world’s second-largest aluminum company, some Russian oligarchs, Iranian politicians, and Venezuelan drug traffickers.
  • Huawei not respond to TechNode’s request for comment on Wednesday.

Context: In May, the Trump administration added Huawei on a commerce department “Entity List,” barring the company from importing components and technology from American companies without US government approvals.

  • Huawei was given three 90-day grace periods after the ban was implemented, with the latest to end in February 2020.
  • The sanctions against Huawei are often regarded as a bargaining chip for the Trump administration in its ongoing trade talks with China.
  • The SDN list is a revere financial restriction that bars US citizens and residents from trading or conducting financial transactions with named entities, and freezes all related assets held in the US.