Source: Bloomberg/Bloomberg


 Source: Bloomberg/Bloomberg

U.S. Sees More Support for ‘Clean Network’ Plan to Counter China

Krach says 49 countries have joined the U.S.-led initiative

 It’s ‘taken all the momentum away from Huawei,’ Krach says

KEITH KRACH, UNDER SECRETARY FOR ECONOMIC GROWTH, ENERGY AND THE ENVIRONMENT

Source:  Bloomberg  Nick Wadhams

October 30, 2020

The U.S. has brought 49 countries, representing two-thirds of global economic output, into its “Clean Network” initiative aimed at limiting Chinese companies from access to sensitive sectors such as cloud computing and 5G mobile networks, a senior administration official said.

Restrictions on companies such as Huawei Technologies Co., which the U.S. says is beholden to China’s Communist Party and presents a national-security risk, have so limited Huawei’s access to crucial technology that the U.S. believes it could run out of chips for much of its hardware by sometime next year, Undersecretary for Economic Growth, Energy and the Environment Keith Krach said in an interview.

“Countries and companies are more and more asking the question, ‘Who do we trust?’” Krach said Thursday. “The answer’s coming back, it’s certainly not Huawei because they’re the backbone of the Chinese Communist Party’s surveillance state.”

Krach has been the leading advocate of Secretary of State Michael Pompeo’s push to banish Chinese technology in systems around the world, as part of a broader administration effort to constrain China’s global ambitions. He recently visited Taiwan and toured European nations as well as the Middle East to secure commitments from more governments to join the U.S. effort.

“The success of the Clean Network has taken all the momentum away from Huawei,” Krach said. “When we looked at this six months ago it looked like Huawei was unstoppable.”

China’s embassy didn’t immediately respond to a request for comment on Friday. Huawei has repeatedly rejected claims that its technology compromises U.S. national security.

Huawei has told Chinese wireless operators that its component inventory can support base station construction in 2021 and beyond despite U.S. sanctions. Rotating Chairman Guo Ping said last month the company has “sufficient” inventory for its communications equipment business, but consumer business chief Richard Yu said in a recent presentation that Huawei is suffering from what he called an “unfair” U.S. ban.