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China calls on the US ‘bad actions’ as Huawei ban rattles supply chains

BEIJING (Reuters) – China said the United States needs to correct his “wrong actions” for the trade talks to continue after he was on the black list Huawei, a blow that rippled through global supply chains and battered tech shares as investors are afraid of a technology cold war.

FILE PHOTO: A man takes a photo of a Huawei logo on the Huawei European Cybersecurity Center in Brussels, Belgium, 21 May 2019. REUTERS/Francois Lenoir/File Photo

Japanese conglomerate Panasonic Corp joined the growing list of global companies that have said they are solid Huawei Technologies Co Ltd, the world’s second-largest seller of smartphones and the largest telecom-gear maker, saying that it had stopped the transfer of a number of components.

The move came a day after the British chip designer ARM said that it had stopped relations with Huawei to comply with the U.S. supply blockage, potentially crippling the Chinese company the ability to introduce new chips for smartphones. Huawei makes use of ARM blueprints for the design of the processors that power its smartphones.

“If the United States wants to continue talks, they should show sincerity and correction of their wrong deeds. The negotiations can only proceed on the basis of equality and mutual respect,” Chinese Ministry of Commerce spokesman Gao Feng told a weekly briefing.

“We will closely follow relevant developments and prepare necessary responses,” he said, without specifying.

The United States has accused Huawei of working for the Chinese government and activities contrary to the national security, the accusations Huawei denies. The Trumpet administration softened its attitude somewhat this week by granting the company a license to buy AMERICAN goods to Aug. 19 to minimise disruption for customers.

The japanese Toshiba Corp said it had resumed some shipments to Huawei after the temporary suspension of the shipments to verify that the supplied US-made components.

“What we are witnessing is a possible reconfiguration of the global trade has been since the second world War … investors should start to think about how sensitive their portfolio to the global supply chain is exposed to shocks,” Saxo Bank head of equity strategy, Peter Garnry, wrote in a note with the title “Are you ready for a cold war in tech?”

Huawei founder Ren Zhengfei told the Chinese financial magazine Caixin on Thursday that he was not ARM ‘ s decision to suspend of the business with Huawei have an impact on the company.

He said that Huawei had a long-term agreement with ARM and speculated that the British firm had made such a move, since the parent, Japan’s SoftBank Group Corp, was waiting for US approval for the merger of Sprint Corp., which it owns, and T-Mobile US Inc.

Industry Experts have questioned Huawei’s claims, minimize the impact of the movements that make it difficult for the company to do business with American companies.

No further negotiations between the Chinese and AMERICAN negotiators have already been planned since the last round ended on May 10, the same day that the AMERICAN President Donald Trump sharply increased rates on $ 200 billion worth of Chinese goods, and took steps to levy import duties on other Chinese imports.

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Speaking at a separate briefing in Beijing, a spokesman of the chinese Ministry of Foreign affairs, stressed that China’s door was always open for a conversation, but that the situation with Huawei and other Chinese tech companies, the target of the United States made this difficult.

“Relevant U.S. actions, of course, not the creation of a proper atmosphere or environment for consultations,” spokesman Kang Lu said.

China has retaliated with its own levies on imports from the US, but it was Washington, the move against Huawei, the trade war into a new phase, stoking the fears of the risks to the global growth and knocking the financial markets.

Reporting by Stella Qiu, Se Young Lee; Writing by Tony Munroe; Editing by Christopher Cushing and Nick Macfie

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