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US-China tensions weigh on Huawei’s links with its partners-FedEx, Ex

HONG KONG / SHANGHAI (Reuters) – U.S. of FedEx Corp. (a). (FDX.N) on Friday once again apologized and put the blame of Washington’s ban on Huawei “unclear”, as Beijing deepens, an investigation into the reason as to why the delivery company also kept the packages of which are to be used in the telecom-equipment maker.

A Federal Express delivery truck that is shown in the center of Los Angeles, state of California, united states, October 24, 2018. REUTERS/Mike Blake

Huawei was set up by Washington in a “black list” in mid-May that effectively blocks U.S. companies from doing business with the Shenzhen office.

The Chinese authorities investigate FedEx, suspected of illegal possession of more than 100 Huawei [HWT.UL] packages, as well as violations of other laws, as state news agency Xinhua said on Friday.

FedEx, in a statement on Friday afternoon saying: “The shipments in question were to be treated, as we try to comply with the U.S. DOC, BIS, the order in which it is unclear and has resulted in a significant complexity to our business. Please accept our apologies for the confusion, or to cause harm to our customers as a result.”

Beijing began an investigation into FedEx last month, after the Ascend of the united states said the delivery company had transferred plots of land used for the business. Xinhua said on Friday that researchers have discovered “evidence for the other offences”.

On Thursday, Huawei was accused of being U.S.-listed Flex (FLEX.(O) the appropriation of goods from China.

The developments mark the latest fallout from Washington’s ban on Huawei, which not only rattled the worldwide technology supply chain is bound to the Huawei’s $105 billion and the business community, but is also the cause of a lot of confusion between the enterprises and the organisations, far beyond the borders of the united states of america, with respect to the boundaries of the constraints.

FedEx has apologized for multiple incidents of abuse on Smartphone packages, which were attributed to operational errors”, but later sued the U.S. government for what it said was an “impossible task” in order to “police the contents” of the export shipments.

FedEx said Friday that it was an initiative of the AMERICAN DOC, “in order to avoid similar incidents in the future,” and reiterated its commitment to the Chinese market.

For Huawei, told Reuters on Thursday, Flex, had been withheld about 700 million yuan ($102 million), the value of the goods at the factory in China, have been confirmed by a report in the Chinese state-backed newspaper Global Times.

Flex is kept to the Huawei equipment in the plant in the southern city of Zhuhai, after the US, the black-list and cause a loss for the Smartphone, according to the report.

Huawei told Reuters that it was picked up with 400 million yuan of goods last month, after negotiations, still trying to take it back, and the rest of us.

Flex said in a statement via e-mail to Reuters, “the Flex and Huawei have had a long-standing and successful partnership, which has been affected due to the unforeseen challenges arising from the US-China trade situation. Both parties are actively working to find a mutually acceptable way forward, having regard to the facts.”

With a Flex-a spokesman refused to say whether or not it’s still a Smartphone of its assets or which counts Huawei as a customer, but it said that China remains “a very important centre for the production and end-of-the-market”, where there is the work of tens of thousands of people.

Flex said on Friday in its quarterly earnings statement that it would speed up a move to reduce exposure to certain products, and in China and India, the recent geo-political developments and uncertainties”, which are primarily affected “to a customer in China. It is not the name of the customer.

“We have seen a decline in the demand for the products that are assembled for the customer,” he said.

Reporting by Sijia Jiang of Hong Kong, as well as Josh Horwitz; Editing by Muralikumar Anantharaman and Elaine Hardcastle

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