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China encourages US to stop economic bullying

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China encourages US to stop economic bullying

After US regulators suggested to limit funding for Chinese equipment in US telecommunications networks, China accuses the USA for economic bullying.

Foreign ministry spokesman Geng Shuang said that China woud resolutely oppise the US abusing its state power to suppress certain Chinese enterprises with vatious unwarranted charges without evidence.

Geng Shuang further expresses how they are strongly urging the US to stop abusing the concept of national security. China claims that the economic bullying behavior is a denial of the market economy principle, something which the US strongly supports. This series of action would further undermine the interest of US businesses and consumers, most especially in rural areas.

The Federal Communications Commission will decide next month whether to prohibit companies from using government subsidies to pay for networking equipment from ZTE and Huawei.

Meanwhile, Huawei and ZTE can contest the decision within 30 days. The FCC’s national security risk designation and a final order suggesting the removal of equipment ruling is expected to be out until next year at the earliest.

Huawei has never had a major security-related incident in the 170 countries where it operates in its 30 years of business. The proposal communicated by the FCC Chairman has affected the broadband providers in the most unserved or underserved rural areas of the United States.

And from Huawei’s point of view, such action just widen the digital divide which will rather slow down the pace of economic development without further securing the nation’s telecommunications networks. Almost 25% of US Rural Wireless Association use Huawei and ZTE equipment in their networks and replacing them would cost US$800 million to one billion.

The change will most likely have a direct effect on small and rural companies, since larger US wireless companies do not use equipment from the two Chinese firms.Moreover, the agency is also exploring the effect of requiring companies to destroy their current Huawei and ZTE equipment which would cost up to US$1 billion.

The government is seeking comments on how it can help companies financially if they’re required to do that. Bills in Congress have proposed setting a particular budget as much as US$1 billion aside for telecom companies to replace their networks.

Huawei denies US’ claims of posing an espionage threat. Being the world’s biggest supplier of telecom gear and ranks second smartphone manufacturer, Huawei stands firm that the US has presented no evidence of its equipment being used for spying by the Chinese government, to which both Huawei and ZTE denies such claims.

Furthermore, the US government has been influencing allies to ban Huawei from their networks and has restricted exports of US technology to Huawei.

In addition to this issue, Geng reveals that cases of the PRISM program and Alstom are still fresh in their memories, but until now, the United States has not given a clear explanation to the international community.

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