EU will ‘stand firm’ against Washington over trade disputes

An airport staff walks behind parked planes of the Airbus factory Hamburg-Finkenwerder at the Erfurt-Weimar airport in Erfurt, Germany. (AP/File)
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Updated 07 July 2020

EU will ‘stand firm’ against Washington over trade disputes

  • Issues dating back to 2004 over subsidies for Airbus and Boeing are drawing to a conclusion at WTO

BRUSSELS: The EU will take decisive action against the US if it is unwilling to settle a long-running row over aircraft subsidies and presses ahead with a series of new trade investigations, Europe’s trade commissioner said on  Monday.

A trade dispute dating back to 2004 over subsidies for Europe’s Airbus and US planemaker Boeing is drawing to a conclusion at the World Trade Organization (WTO).

It has already awarded Washington the right to impose duties on $7.5 billion of European goods related to subsidies given to Airbus but is only expected to rule in September what retaliation Europe can take over support for Boeing. European Trade Commissioner Phil Hogan told the European Parliament’s trade committee that Washington had twice rejected EU proposals to settle the dispute and he hoped the WTO would issue its findings as soon as possible in September.

EU officials said they did not expect the United States to want to settle the dispute before then.

“I want to reassure people that we are ready to act decisively and strongly on the EU side if we don’t get the type of outcome that we expect from the US in relationship to finalizing this 15-year-old dispute,” he said.

Since US President Donald Trump took office, he has repeatedly criticized the EU over its trade surplus in goods and imposed tariffs on metal imports from the EU and threatened to do the same for cars made in the bloc.

Hogan said Washington’s recent launch of several “Section 232” investigations, which assess the impact of imports on US national security, was unacceptable.

The investigations cover mobile cranes and transformers and have been expanded to include steel products, such as nails. The US is also looking into whether planned EU digital services taxes impede US commerce.

“It’s not appreciated the number of 232 investigations that have been launched in recent weeks, perhaps this is political, perhaps it’s more real,” Hogan said.

“This is totally unacceptable ... and if these investigations go further the EU will have to stand together and act as well,” he said.


Huawei: Smartphone chips running out under US sanctions

Updated 08 August 2020

Huawei: Smartphone chips running out under US sanctions

  • Huawei is at the center of US-Chinese tension over technology and security
  • Washington cut off Huawei’s access to US components and technology last year

BEIJING: Chinese tech giant Huawei is running out of processor chips to make smartphones due to US sanctions and will be forced to stop production of its own most advanced chips, a company executive says, in a sign of growing damage to Huawei’s business from American pressure.
Huawei Technologies, one of the biggest producers of smartphones and network equipment, is at the center of US-Chinese tension over technology and security. The feud has spread to include the popular Chinese-owned video app TikTok and China-based messaging service WeChat.
Washington cut off Huawei’s access to US components and technology including Google’s music and other smartphone services last year. Those penalties were tightened in May when the White House barred vendors worldwide from using US technology to produce components for Huawei.
Production of Kirin chips designed by Huawei’s own engineers will stop Sept. 15 because they are made by contractors that need US manufacturing technology, said Richard Yu, president of the company’s consumer unit. He said Huawei lacks the ability to make its own chips.
“This is a very big loss for us,” Yu said Friday at an industry conference, China Info 100, according to a video recording of his comments posted on multiple websites.
“Unfortunately, in the second round of US sanctions, our chip producers only accepted orders until May 15. Production will close on Sept. 15,” Yu said. “This year may be the last generation of Huawei Kirin high-end chips.”
More broadly, Huawei’s smartphone production has “no chips and no supply,” Yu said.
Yu said this year’s smartphone sales probably will be lower than 2019’s level of 240 million handsets but gave no details. The company didn’t immediately respond to questions Saturday.
Huawei, founded in 1987 by a former military engineer, denies accusations it might facilitate Chinese spying. Chinese officials accuse Washington of using national security as an excuse to stop a competitor to US tech industries.
Huawei is a leader among emerging Chinese competitors in telecoms, electric cars, renewable energy and other fields in which the ruling Communist Party hopes China can become a global leader.
Huawei has 180,000 employees and one of the world’s biggest research and development budgets at more than $15 billion a year. But, like most global tech brands, it relies on contractors to manufacture its products.
Earlier, Huawei announced its global sales rose 13.1 percent over a year ago to $65 billion in the first half of 2020. Yu said that was due to strong sales of high-end products but gave no details.
Huawei became the world’s top-selling smartphone brand in the three months ending in June, passing rival Samsung for the first time due to strong demand in China, according to Canalys. Sales abroad fell 27 percent from a year earlier.
Washington also is lobbying European and other allies to exclude Huawei from planned next-generation networks as a security risk.
In other US-Chinese clashes, TikTok’s owner, ByteDance, is under White House pressure to sell the video app. That is due to fears its access to personal information about millions of American users might be a security risk.
On Thursday, President Donald Trump announced a ban on unspecified transactions with TikTok and the Chinese owner of WeChat, a popular messaging service.