U.S. set to give Huawei another 90 days to buy from American suppliers – sources

The U.S. Commerce Department is expected to extend a reprieve given to Huawei Technologies that permits the Chinese firm to buy supplies from U.S. companies so that it can service existing customers, Reuters reported on Saturday.

The “temporary general license” will be extended for Huawei for 90 days, sources said.

The Commerce Department initially allowed Huawei to purchase some American-made goods in May shortly after blacklisting the company in a move aimed at minimizing disruption for its customers, many of which operate networks in rural America.

An extension will renew an agreement set to lapse on August 19, continuing the Chinese company’s ability to maintain existing telecommunications networks and provide software updates to Huawei handsets.

The situation surrounding the license, which has become a key bargaining chip for the United States in its trade negotiations with China, remains fluid and the decision to continue the Huawei reprieve could change ahead of the Monday deadline, the sources said.

U.S. President Donald Trump and Chinese President Xi Jinping are expected to discuss Huawei in a call this weekend, one of the sources said.

Huawei did not have an immediate comment. China’s foreign ministry did not immediately respond to a faxed request for comment.

When the Commerce Department blocked Huawei from buying U.S. goods earlier this year, it was seen as a major escalation in the trade war between the world’s two top economies.

The U.S. government blacklisted Huawei alleging the Chinese company is involved in activities contrary to national security or foreign policy interests.

The world’s largest telecommunications equipment maker is still prohibited from buying American parts and components to manufacture new products without additional special licenses.

Many Huawei suppliers have requested the special licenses to sell to the firm. Commerce Secretary Wilbur Ross told reporters late last month he had received more than 50 applications, and that he expected to receive more.

Out of $70 billion that Huawei spent buying components in 2018, some $11 billion went to U.S. firms including Qualcomm, Intel and Micron Technology.

The Commerce Department late on Friday declined to comment, referring to Ross’s comments to CNBC television earlier this week in which he said the existing licenses were in effect until Monday.

U.S. removes some Chinese furniture, modems from planned 10% tariffs

The Trump administration is also sparing some Chinese-made household furniture, baby items and internet modems and routers from its next rounds of 10% tariffs, it said on Friday.

The U.S. Trade Representative’s office released a complete list of the items that were removed from $300 billion in tariffs scheduled to go into effect on Sept. 1 and Dec. 15, some of which had already been hit with 25% tariffs.

Trump on Tuesday delayed more than half of the proposed tariffs until December, saying it would help shield businesses and consumers from the U.S.-China trade war fallout during the Christmas selling season.

The new list of 44 categories of spared imports, worth about $7.8 billion according to U.S. Census Bureau data, also includes some chemical compounds used in the manufacture of plastics. Reuters previously reported that bibles and religious texts would be spared from the tariff list.

Modems and routers made in China were part of a $200 billion list of products hit with tariffs last September that have since been raised to 25%. Friday’s exclusion would avoid a further 10% hike as Trump imposes tariffs on Sept. 1 to products in the same broad customs category, including smart watches, smart speakers and Bluetooth headphones.

The bulk of the items removed from the tariff list were furniture products, including wooden- and metal-framed chairs and those made of plastics. Some of these were previously hit with tariffs as part of broader furniture categories.

Baby-related furniture items also were spared, including toddler beds, bassinets, cradles, strollers and children’s seats.

The $114 billion retail furniture industry has been among the sector’s hardest hit with price increases due to Trump’s tariffs, which rose to 25% in May.

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