Largest contract chipmaker in the world halts deliveries to Huawei
US-China trade tensions flare up once more
In the latest sign of deteriorating trade tensions between the United States and China, the largest contract chipmaker on earth has reportedly stopped shipments to Huawei Technologies.
The Taiwan Semiconductor Manufacturing Co. (TSMC) will supposedly no longer take any new orders from the Chinese tech giant but will complete on any transactions billed before the most recent American move was announced.
On Friday, the US Commerce Department admitted to its desire to “cut off Huawei’s efforts to undermine US export controls,” and amended an export regulation to “strategically target Huawei’s acquisition of semiconductors that are the direct product of certain US software and technology.”
Through such measures the US government will hope to close loopholes through which American technology firms bypassed Washington’s trading blacklist to maintain business with Huawei and other major Chinese firms.
Responding to the recent claims, TSMC has stated that it "does not disclose customers' order details,” adding it “has always complied with the laws and applicable regulations." With this seemingly tacit admission that it has end shipments to its second-largest customer, the company closed Monday trading down 2.68 per cent at 290.00 TWD.
Having briefly lulled following the signing of the phase-one initial trade agreement, tensions between the world’s two largest economies have flared up following the Covid-19 crisis. The Trump administration has laid much of the blame for the medical and economic devastation wrought by the coronavirus outbreak at China’s door, where it originated.
For its part, the Chinese Department of Commerce stated on Sunday that it: "strongly objects to the new export controls and warned such restrictions would pose a huge threat to the global supply chain. If Washington doesn't reverse the action, Beijing warned it would face retaliation.”