The United States is planning to further extend sanctions on Huawei , which would thwart a big deal NVIDIA was hoping to have with this Chinese brand
NVIDIA is in big trouble after a draft of the US government’s plans to extend its sanctions on Huawei was revealed .
According to Reuters , the report even speaks directly to NVIDIA , noting that it “will have a high economic impact” on the company.
The Joe Biden administration has been considering limiting the items it allows US companies to ship to Huawei , a company that has been on the US trade blacklist since 2019 but continues to receive billions in US goods under a special plan implemented by the Donald Trump administration.
However, with the draft seen by the outlet, now “the (Commerce Department’s) proposed 2023 license amendment will likely have a high economic impact on NVIDIA ,” referring to the company’s “pending license value.”
The document shows that the Biden administration is trying to assess the impact on US companies of Huawei ‘s proposed policy changes before imposing new rules that could affect annual cash revenue streams.
A state source noted that the preliminary draft “was not approved in such form.” The government “has written and commissioned multiple reports on this issue, based on different contingencies, reaching very different conclusions,” she said.
Another of the companies that will have an impact on its economy, but in a moderate way is Qualcomm.
The report suggested that Qualcomm would likely suffer a “moderate economic impact” from the policy change. In fact, losing access to Qualcomm ‘s modem chips would have a bigger impact on Huawei , the report predicts, as the Chinese giant “relies heavily on Qualcomm ‘s modem chips to support its smartphone offerings.” .
Huawei was blacklisted in 2019 amid fears it could spy on Americans and accusations it was stealing intellectual property and violating sanctions. The US requires suppliers to seek a special license that is typically denied when they sell US products to listed companies. But the Trump administration instituted a more lenient policy for Huawei, blocking its access to 5G chips but allowing other items such as 4G chips to be shipped to the company.