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Trump hints at Huawei as bargaining chip

Credit: Reuters - Politics
Published on May 24, 2019 - Duration: 02:23s

Trump hints at Huawei as bargaining chip

U.S. President Donald Trump hinted the U.S. could ease the embargo on Chinese telecoms giant Huawei in return for a trade deal.

Michelle Hennessy reports.

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Trump hints at Huawei as bargaining chip

U.S. President Donald Trump on Thursday (May 23) hinted the U.S. could ease the embargo on Chinese telecoms giant Huawei in return for a trade deal.

He told reporters at the White House what he thinks of the world's largest telecoms gear maker.

(SOUNDBITE) (English) U.S. PRESIDENT DONALD TRUMP, SAYING: "Huawei is something that is very dangerous.

You look at what they have done from a security standpoint, from a military standpoint and it is very dangerous.

So it is possible that Huawei even would be included in some kind of a trade deal." His comments come a week after Washington stuck Huawei on a trade blacklist effectively banning U.S. firms from doing business with the company.

The move was a major escalation of Washington's worldwide campaign against Huawei sparked by fears that its phones and network equipment could be used by Beijing to spy on Americans.

Reuters Breakingviews Pete Sweeney says that's bad news for a company that gets half its revenue from overseas.

(SOUNDBITE) (English) REUTERS BREAKINGVIEWS ASIA EDITOR PETE SWEENEY, SAYING: "Huawei runs all its phones on Android like all the other Chnese cell phone makers, right?

Android is free to use and Huawei can use it long as it wants.

But Android without apps in a foreign market - if you have an Android phone and you can't put like Facebook or you know Youtube or any of these things on it is just kind of like a really expensive piece of plastic.

Now, by banning this Google proprietary technology the United States government has effectively made it quiet difficult for Huawei to put things that foreign users actually use on these Android cell phones.

Huawei's options are limited.

The company can wait to see if Trump will let the company off the hook as part of a U.S.-China trade deal.

Or it can re-think its sales strategy.

(SOUNDBITE) (English) REUTERS BREAKINGVIEWS ASIA EDITOR PETE SWEENEY, SAYING: "Realistically what they're going to have to do is look very strongly at their home market and try to build that up.

That won't be easy either.

It's got competitors at home.

I mentioned ZTE, there's also smartphone makers like Xiaomi.

They'll have to go in and try and get contracts from state-owned telecoms, the utilities, China Mobile those guys.

All that money kind of comes through Beijing's good graces.

The fact of the matter is that if things go poorly Huawei will become more of what you know the White House and its detractors accuse it of being which is a state-controlled company." Trump predicted a swift end to the trade war with China.

However, no high-level talks have been scheduled between the two countries since the last round of negotiations ended in Washington two weeks ago.

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