An alarming escalation .. The United States cut supplies to Huawei and China are responding

China has responded that the US administration must stop "unjustified repression" against Huawei after the Trump administration's decision to block global chip supplies to the blacklisted Chinese telecom equipment giant. 

On Sunday, the Chinese Ministry of Commerce said it firmly opposes the latest rules the United States has set against Huawei, and will take all necessary measures to protect the rights and interests of Chinese companies.

In the statement, the ministry urged the United States to immediately stop "wrongdoing," and in its response to questions about whether Beijing would take retaliatory actions against the United States, it made clear that China would vigorously defend the legal rights of its companies.

On Saturday, the Chinese Global Times quoted a source close to the Chinese government as saying that Beijing was ready to take a series of countermeasures against the United States, such as placing US companies on a "list of unreliable entities" and imposing restrictions on American companies such as Apple, Cisco and Qualcomm.

The People's Daily - the official newspaper of the ruling Communist Party of China - said the source also mentioned the suspension of the purchase of Boeing aircraft.

"China will take strong countermeasures to protect its legitimate rights" if the United States goes ahead with a plan-changing plan and prevents major chip suppliers - including Taiwan-based TSMC - from selling it to Huawei, the source said. . 

The Trump administration has moved to block the global chip supply to Huawei, as the new base entered into force on Friday, but it will grant a 120-day grace period.

TSMC is Huawei's largest chip maker and main supplier, and had announced plans to build a US-based plant last Thursday.

The United States did not provide any guarantees for the Taiwanese firm TSMC to license its sales to Huawei, while the Taiwanese company said on Friday it would "closely follow changes in US export rules, and it is working with an external consultant to conduct a legal analysis and ensure a comprehensive understanding and interpretation of this." the rules".

"The United States has used national strength and used the so-called national security concern as an excuse, and has misused export controls to continue to repress some private companies in other countries," the Chinese Ministry of Commerce said in a statement today.

US Secretary of State Mike Pompeo justified the new measure as aimed at protecting "the safety of 5G networks, and preventing Huawei from undermining US export controls."

"This measure places America at the forefront, American companies first, and American national security first," a senior Commerce Department official told reporters at a conference call on Friday.

For his part, considered Kevin Wolf, a lawyer in Washington and a former official in the Ministry of Commerce that the base appears to be "a new and complex expansion of US export controls" of the elements related to the chip, made using American technology abroad and sent to Huawei. 

Huawei - which needs semiconductors for smartphones and its communications equipment - has found itself at the center of a battle for global technological dominance between the United States and China, whose relationship has been strained in recent months by the spread of the Corona virus.

Currently, most chip makers rely on equipment produced by American companies, while some of the sophisticated tools required to make chips come from companies outside the United States, such as Tokyo Electron Japan and Hitachi and the Dutch company ASML, and analysts say that It would be difficult to assemble a complete toolkit for advanced semiconductor making without some American equipment.

"We are concerned that this base may create uncertainty and turmoil in the global semiconductor supply chain," said John Niover, CEO of the semiconductor industry.