Connect with us

Business

Huawei, SMIC suppliers received billions worth of licenses for U.S. goods -documents

Published

on

October 21, 2021

By Karen Freifeld and Alexandra Alper

WASHINGTON (Reuters) -Suppliers to Chinese telecoms giant Huawei and China’s top chipmaker SMIC got billions of dollars worth of licenses from November through April to sell them goods and technology despite their being on a U.S. trade blacklist, documents seen by Reuters showed on Thursday.

According to the documents, 113 export licenses worth $61 billion were approved for suppliers to ship products to Huawei while another 188 licenses valued at nearly $42 billion were greenlighted for Semiconductor Manufacturing International Corp (SMIC).

Advertisement

The data also showed that more than 9 out of 10 license applications were granted to SMIC suppliers while 69% of requests to ship to Huawei were approved over the same period.

The U.S. House of Representatives Foreign Affairs committee on Thursday voted to grant a request by its top Republican member Michael McCaul to release the licensing data, which it received from the Commerce Department in May.

House Republicans on the committee provided the documents to Reuters following the authorization, at Reuters request. The documents are expected to be posted publicly soon.

The numbers could enrage China hawks in Washington, who have made a concerted effort to deprive Chinese companies of access to advanced U.S. technology.

“It’s clearly in our national interest to increase transparency and public scrutiny on how our nation transfers its technology to an adversary,” McCaul said in a statement.

Advertisement

Republican senator Marco Rubio told Reuters he thinks President Joe Biden needs to explain why the companies have continued to receive “waivers.”

“It is just another example of President Biden not taking the economic and security threat posed by the Chinese Communist Party seriously,” he said.

The Commerce Department said in a statement that the release of an arbitrary snapshot of license approvals “risks politicizing the licensing process and misrepresenting the national security determinations” made by the government.

It also stressed that approved license applications do not represent actual shipments and around half of all licenses are used. It added that license applications involving Huawei and SMIC are processed under policies developed by the Trump administration and maintained by the Biden administration.

Huawei declined to comment, while SMIC did not respond to a request for comment.

Advertisement

Huawei was placed on a trade blacklist in May 2019 over national security concerns, forcing its U.S. suppliers and others to obtain a special license to ship goods to it. SMIC was added to the so-called entity list in December 2020, over fears it could divert advanced technology to military users.

A majority of the licenses granted did not authorize shipments of sensitive items. Of the 113 licenses approved for Huawei during the period, 80 were for non-sensitive items that only required a license because the recipient was blacklisted. For SMIC, the figure was 121 of 188.

Licenses are generally good for four years.

Reuters reported earlier this year that, during the Trump administration, $87 billion worth of licenses https://www.reuters.com/article/us-usa-huawei-tech/biden-administration-adds-new-limits-on-huaweis-suppliers-idUSKBN2B3336 for Huawei were approved after it was blacklisted.

(Reporting by Karen Freifeld and Alexandra Alper, Editing by Chris Sanders and Rosalba O’Brien)

Advertisement

Continue Reading
Advertisement

Business

Buying the Omicron dip

Published

on

November 29, 2021

A look at the day ahead from Danilo Masoni.

Sell first, get answers later. With stocks near lifetime peaks, the Black Friday reaction to the new fast-spreading virus strain Omicron was hardly surprising.

But a weekend later, investors look heavily engaged in buying the dip, as markets take a more balanced view of risks attached to what the WHO called a “variant of concern”.

Advertisement

After their ninth biggest drop ever on Friday, gains in crude prices topped 5% earlier in Asia and stock futures point to a solid bounce across Europe and America.

A South African doctor said patients with Omicron have “very mild” symptoms and investment houses don’t look to have budged that much. Credit Suisse, for example, made no portfolio changes, staying slight overweight on equities.

Perhaps more telling is that retail traders poured north of $2 billion into U.S. stocks on Friday, setting the second biggest daily inflow on record, per Vanda Research data.

Of course there are uncertainties and that will likely make for volatile days heading into the Christmas shopping season.

Understanding the level of severity of the variant “will take days to several weeks”, said WHO. And vaccine maker BioNTech needs up to two weeks to figure out whether the shot it makes with Pfizer needs to be reworked.

Advertisement

So while Omicron has spread from Australia to the Netherlands and governments ban travel and mull lockdowns, markets may also gamble on central bankers turning more patient in their path towards rates normalisation.

Lots of speakers from the Federal Reserve and the European Central Bank are lined up for today. On Sunday, speaking about risks to the recovery, ECB’s Lagarde said: “We now know our enemy and what measures to take.”

Key developments that should provide more direction to markets on Monday:

* ECB speakers: Governor Lagarde, ECB board members AndreaEnria, Isabel Schnabel, Pentti Hakkarainen; ECB Vice PresidentLuis de Guindos * Euro zone consumer sentiment/inflation expectations * German preliminary CPI/HICP * Fed speakers: Chairman Jerome Powell, New York PresidentJohn Williams, Governor Bowman * Emerging markets: Kenya central bank meets; Turkey tradebalance and bank NPL ratios (This story refiles to fix chart)

(Reporting by Danilo Masoni; Editing by Saikat Chatterjee)

Advertisement

Continue Reading

Business

UK regulator set to block Meta’s Giphy deal – FT

Published

on

November 29, 2021

(Reuters) -The UK competition regulator is expected to block Meta Platforms’ acquisition of online GIF platform Giphy in the coming days, the Financial Times reported https://www.ft.com/content/662c8e3f-4909-4bec-9131-c0237bb4897d on Monday.

The Competition and Markets Authority is set to reverse the deal in what would be the first time the watchdog has reversed a Big Tech acquisition, the report said, citing individuals close to the matter.

Meta Platforms and the regulator did not respond to requests for comment from Reuters sent outside working hours.

Advertisement

The regulator had in October fined the U.S. social media giant Facebook, now Meta, 50.5 million pound ($67.35 million) for breaching an order that was imposed during an investigation into its purchase of the GIF platform, Giphy.

Facebook bought Giphy, a website for making and sharing animated images, or GIFs, in May last year to integrate it with its photo-sharing app, Instagram. The deal was then pegged at $400 million by Axios.

($1 = 0.7499 pounds)

(Reporting by Sneha Bhowmik in Bengaluru; Editing by Uttaresh.V)

Advertisement
Continue Reading

Business

Evergrande shares fall after chairman cuts stake; Fantasia suspends trading

Published

on

November 29, 2021

HONG KONG (Reuters) – Shares in China Evergrande Group fell as much as 4.8% on Monday morning, after its chairman trimmed his stake in the cash-strapped property developer to raise about $344 million.

The group’s electric vehicle unit, China Evergrande New Energy Vehicle Group Ltd, also dropped more than 5% after it said the company was still exploring ways to pump capital into the unit with different investors.

Evergrande has been scrambling to raise capital as it grapples with more than $300 billion in liabilities and Chinese authorities have told its chairman, Hui Ka Yan, to use some of his personal wealth to help pay bondholders, sources have said.

Advertisement

Evergrande failed to pay coupons totalling $82.5 million due on Nov. 6 and investors are on tenterhooks to see if it can meet its obligations before a 30-day grace period ends on Dec 6.

The developer disclosed late on Friday that Hui had sold 1.2 billion shares in the company at an average price of HK$2.23 each, lowering his stake in the Shenzhen-based real estate developer to 67.9% from 77%.

Once China’s top-selling developer, Evergrand’e troubles have hit the broader Chinese property sector with a string of debt defaults and credit rating downgrades of its peers in the last couple of months.

Fantasia Holdings suspended trading in company shares on Monday pending release of information. On Thursday, the developer said a winding-up petition was filed against a unit related to an outstanding loan.

(Reporting by Sumeet Chatterjee; Editing by Stephen Coates)

Advertisement

Continue Reading
Advertisement

Trending