A group of Republican senators want to shut down a chip center to snub Huawei but have failed at every turn to keep the telecom giant grounded
A group of US senators – Marsha Blackburn, Tom Cotton, Bill Hagerty, Ted Cruz and Marco Rubio – all sent an open letter to President Joe Biden on Monday asking his administration to “move quickly to stop Huawei from building the Pengxinwei IC Manufacturing Company (PXW) semiconductor plant.”
As they say in the letter, “Opening this factory would disadvantage the United States in the fight against Huawei, advance Communist China’s military-civilian merger campaign, disadvantage American semiconductor companies, and pose a national security concern.”
Specifically, citing a Bloomberg report, the letter says, “Huawei began construction of a factory more than seven months ago where PXW is expected to eventually mass-produce chips as advanced as 14 nanometers and 7 nanometers.” It would be, as they say, “represent a dangerous leap in Chinese semiconductor manufacturing, as Chinese chipmakers have so far only been able to produce 7-nanometer chips in limited quantities.”
With this new technology in hand, “Huawei may resume its march toward 5G market dominance, and the CCP will continue its plan to control global telecommunications and expand its economic espionage and suppression.”
From the framing of this letter, you would think it is being constructed right under the nose of the US government in the middle of Texas or Washington, DC. But no, it is being built… in Shenzhen, a city in the Pearl River Delta in China. Given this, there seems to be little that these senators can do (apart from sending a strongly worded letter) to shut down the facility.
Still, they give some specific points about what could be done. The senators decried Biden’s lack of effort or enthusiasm in fighting the construction of the facility, noting that the Commerce Department may add PXW to its list of Bureau of Industry and Communication entities. security (BIS) or its list of Huawei subsidiaries under the Foreign Direct Product Rule. . This would allow the administration to halt shipments and transactions with the facility, effectively sanctioning it and setting it back in terms of access to resources and investment.
But that’s as far as it goes. As Huawei has already demonstrated, it can succeed despite US sanctions – not just in terms of research and development, but in terms of being a viable business. The Shenzhen-based telecommunications giant, whose name literally translates from Mandarin to “China has promises” is a symbol of Beijing’s meteoric rise over the years from a relatively poor country to the world’s second largest economy in terms of nominal gross domestic product and a hub of innovation.
In 2021, despite US sanctions, the company saw an overall drop in sales but posted record profits. In fact, all told, the company said in March that its net profit jumped 75.9% year-over-year despite baseless claims by “security issues” released by U.S. intelligence agencies and media in virtually every country where Huawei does business.
And not only that, Huawei finds workarounds to US sanctions. Witness the sanctions imposed by Washington centered on semiconductors and the loss of access, for example, to the Android operating system. This prompted the company to develop its own HarmonyOS operating system, which is now the fastest growing operating system for mobile devices in the world. (I pointed to this development at the time as a major symbol of the success of China’s reform and opening-up policies and I stand by it today.)
So, with all of this in mind, the odds that the Department of Commerce will be able to shut down a Chinese manufacturing plant in China are less than slim. It’s impossible.
The only thing the US side could do, really, to stop the development of this power plant would be to drop a tactical nuke on it and monitor it – and what’s left of any ounce of American free trade credibility. , intellectual property rights, and just about any issue you want to point out – blow to smithereens. Anything less than that is basically demagoguery.
The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.