White House Said to Be Mulling Further Action to Curb Chinese Telecoms
Posted May 2, 2018 11:09 p.m. EDT
Updated May 2, 2018 11:10 p.m. EDT
WASHINGTON — The Trump administration is considering executive action to further restrict the sale of Chinese telecommunications equipment in the United States, people briefed on the discussions said, in a move that could ratchet up tensions between China and the U.S. as the countries vie for technological dominance.
The executive order, which could be released within days, is expected to raise the barrier for government agencies to buy products from foreign telecom equipment providers like Huawei and ZTE, two of China’s most prominent technology firms. Private government contractors may also be restricted from buying foreign telecom products, which the United States believes may be vulnerable to Chinese espionage or disruption.
The order would follow a series of intensifying actions by the Trump administration to block Chinese technology that is seen as a national security threat. In March, the Federal Communications Commission took action to block broadband companies that receive federal subsidies from buying equipment from suppliers that are deemed a risk to national security. In April, the Commerce Department barred ZTE from purchases of U.S. technology for seven years, saying that the company failed to punish employees who violated sanctions.
The Trump administration increasingly views national security and emerging technology as intertwined and has used its authority to protect national security as a way to block China from gaining an economic edge, particularly as it relates to that nation’s ambitious industrial policy, known as Made in China 2025. Both nations are racing to claim dominance in cutting-edge technology like autonomous vehicles and the next generation of wireless services.
On Wednesday, a spokesman for the Department of Defense said the Pentagon was stopping the sale of phones made by Huawei and ZTE in stores on U.S. military bases around the world because of security concerns.
While the Pentagon cannot stop service members from buying the phones elsewhere, the spokesman, Maj. Dave Eastburn, said in an email that the Defense Department was directing U.S. military personnel to be “mindful of the security risks posed by the use of Huawei devices, regardless of where they are purchased.”
“Huawei and ZTE devices may pose an unacceptable risk to department’s personnel, information and mission,” Eastburn said. He cited Senate testimony in February by the director of national intelligence and the heads of the FBI, the CIA and other agencies that Americans should not use Huawei products because of potential security risks.
Huawei declined to comment.
The crackdown on the telecom companies comes as the United States and China trade accusations of unfair policies and threats of tariffs. A delegation of top Trump administration officials, including Steven Mnuchin, the Treasury secretary, arrived in China this week for talks aimed at defusing the tensions.
The Trump administration has been considering other curbs on China, including investment restrictions and curtailing visas for Chinese nationals who work on sensitive research projects. The White House is also weighing new rules that would add to the goods and services traded with China that are subject to so-called deemed export rules. If such rules go into effect, U.S. companies and universities will be required to obtain special licenses for Chinese researchers who have contact with a broader range of technology — making it harder for Chinese citizens to join in scientific research and product development programs.
People familiar with the discussions cautioned that an executive order that expanded on these actions was still being worked on and that legal hurdles remained.
Lindsay E. Walters, the White House deputy press secretary, said the White House had no comment on individual actions. “Protecting critical infrastructure, including the supply chains associated with such infrastructure, is a critical part of protecting America’s national security and public safety,” she added.
U.S. companies have expressed similar national security concerns about foreign tech companies but say they’re waiting for details of the order.
“Addressing global supply chain security concerns has long been a priority for the tech industry,” said Pamela Walker, vice president at the Information Technology Industry Council, a lobbying group. “Moving forward, we urge policymakers to share information with suppliers and contractors so we can increase the level of security and assurance within the supply chain.”