Donald Trump's return to the US presidency, coupled with his appointment of hawkish cabinet members focused on China, signals the likelihood of escalated trade and technology sanctions against Chinese firms. Huawei, a key target during Trump's first term, is expected to face renewed pressure under his administration.
During Trump's first term, the US imposed sweeping sanctions on Huawei, blocking access to advanced semiconductor products and critical components while pressuring allies to exclude Huawei from their telecom infrastructure. These measures severely crippled Huawei's global smartphone business and confined its telecom market primarily to China.
Under the Biden Administration, sanctions against Huawei softened slightly, particularly due to inconsistent enforcement among European allies. However, most US-imposed restrictions on China persisted. For example, only seven of the European Union's 27 member states have fully implemented the "Cybersecurity of 5G networks: EU Toolbox of Risk Mitigating Measures," aimed at curbing Chinese involvement in 5G infrastructure.
Germany, the EU's economic powerhouse, permitted limited Huawei involvement, mandating only the removal of select management systems. This leniency has drawn criticism from the US and several other EU member states, reflecting divisions within the bloc on handling Huawei.
Huawei bounces back: R&D drives resilience
Despite stringent US sanctions, Huawei has displayed resilience, recovering from its lowest points and making a strong comeback in recent years.
In telecom equipment, Huawei has reinforced its position as China's top supplier and expanded its market share in regions outside US-aligned nations, maintaining its global leadership. The company also remains at the forefront of 5G base station power amplifier technology.
In the smartphone market, Huawei overcame the absence of Google Mobile Services (GMS) by launching the Mate 60 Pro in 2023, featuring a self-developed 7nm process chip for 5G. In 2024, it debuted the Mate XT, the world's first mass-produced foldable smartphone, solidifying its status as a leading smartphone brand in China.
Huawei has diversified into the smart vehicle sector, leveraging its ICT expertise to deliver end-to-end solutions, including chips, hardware, software, and cloud services. The company is also scaling its investments in artificial intelligence (AI), public cloud, quantum computing, and other cutting-edge fields.
Trump's cabinet signals hardline China policies
Huawei's expansion into emerging sectors could place it back in the crosshairs of the new US administration. Key appointments in Trump's cabinet point to a likely resurgence of stringent sanctions targeting the Chinese tech giant.
Marco Rubio, Trump's pick for Secretary of State, is a staunch Huawei critic, accusing the company of seeking global dominance. Rubio spearheaded the "Clean Network" initiative, which aimed to exclude Chinese tech products from critical digital infrastructure.
Mike Waltz, the incoming National Security Advisor, has emphasized redirecting US focus from conflicts in Europe and the Middle East to addressing the strategic challenge posed by China. Howard Lutnick, nominated for Commerce Secretary, supports high tariffs on Chinese imports and has criticized China's role in the fentanyl crisis impacting the US.
Trump's second term is expected to escalate sanctions on Huawei and other Chinese tech firms. Measures could include stricter export controls on semiconductor manufacturing equipment, closing technology transfer loopholes, and raising tariffs to pressure allies into isolating Huawei and other Chinese enterprises.
China strikes back: key minerals as strategic leverage
China has not remained passive in the face of US sanctions. It has imposed countermeasures, including restricting exports of critical mineral raw materials and intensifying scrutiny of US companies operating in China. Recently, China launched an antitrust investigation into Nvidia, the leading AI chipmaker.
On December 4, China banned the export of gallium, a key material for manufacturing radio frequency components, to the US. This move is expected to significantly impact the global 5G equipment market.
GaN, derived from combining gallium and nitrogen, offers superior performance and reduced weight in 5G RF power amplifiers. As a major global supplier of gallium, China holds a strategic advantage. Huawei's proficiency in GaN technology strengthens its position in the 5G market. Despite US restrictions on advanced chip technology, much of the RF power amplifier production remains in China, limiting Washington's ability to curb Huawei's progress.
Huawei remains a central figure in the US-China tech standoff, often used as leverage in bilateral negotiations. Unlike its vulnerable position during Trump's first term, Huawei has since achieved significant self-sufficiency in critical technologies. The company has heavily invested in advanced semiconductor processes, mastered key GaN techniques, and established a domestic supply chain to reduce foreign reliance and reshape the global tech landscape.