US set to enforce bans on five Chinese companies

Starting today, US federal contractors will be prohibited from purchasing equipment or services from the Chinese technology firms Huawei, ZTE,

US Reuters

Photo: Reuters

Starting today, US federal contractors will be prohibited from purchasing equipment or services from the Chinese technology firms Huawei, ZTE, Hytera, Hangzhou Hikvision and Dahua Technology.

Although US government agencies have been forbidden to sign contracts with these firms since August of last year, today’s expanded ruling will encompass the entirety of the US federal supply chain. The US Defense Department has asked Congress to delay its enforcement of the mandate—noting that contractors are unprepared—for fear that these far-ranging rules will upend the government’s existing acquisition infrastructure and leave gaps in Washington’s national defence framework.

As Beijing redoubles its efforts to become the world leader in artificial intelligence and telecoms technology, Washington will likely attempt to address the pervasiveness of Chinese firms in the tech space; policy responses include requiring Chinese compliance with US financial auditing guidelines, banning select Chinese firms or a strategic pivot away from Chinese contracts in other sectors. If Chinese firms working in Europe and the US continue to coordinate with Beijing, we could see a new era of sanctions and de-globalisation in an ever-escalating technological cold war, as economies shift inward to focus on domestic development.

Wake up smarter with an assessment of the stories that will make headlines in the next 24 hours. Download The Daily Brief.