Huawei Seeks New Paths Amid US Sanctions 'Impossible'

SCMP Expert Quotes: Huawei's Situation is 'Impossible'
Huawei Building a Complete Industry Chain on Its Own is 'Impossible'

[Asia Economy Beijing=Special Correspondent Jo Young-shin] The Hong Kong South China Morning Post (SCMP) reported on the 19th (local time), citing experts, that it is 'impossible' for Huawei to find a way out due to the U.S. government's new sanctions. The newspaper stated that experts are describing Huawei's situation using the word "impossible."

On the 17th (local time), the U.S. Department of Commerce announced strengthened sanctions that prohibit transactions with Huawei involving semiconductor products that include even a small amount of U.S. technology from design to production, allowing exceptions only under approval conditions.

Additionally, 38 Huawei affiliates from 21 countries worldwide were added to the transaction restriction "blacklist." The total number of Huawei affiliates subject to sanctions has increased to 152. This effectively means that semiconductor manufacturers worldwide can no longer transact with Huawei.

Yang Guang, director at Strategy Analytics, said, "It is hard to even imagine how Huawei could change the situation," adding, "It is impossible for a single company to build a complete industrial chain on its own."

Recently, some in the industry speculated that Huawei is considering establishing semiconductor production capabilities in preparation for the U.S. government raising semiconductor sanctions to the highest level.

Regarding this, Guo Wenzun, an analyst at semiconductor market research firm ICwise, said, "Huawei's only long-term option is to build its own semiconductor supply chain," but added, "It is impossible to build production facilities that do not use any U.S. technology."

Huawei has a subsidiary that designs semiconductors called HiSilicon. HiSilicon's design capabilities are already regarded as among the world's top.

However, Huawei lacks its own production facilities, so semiconductors such as the Kirin series designed by HiSilicon have been entirely produced by Taiwan's foundry company TSMC.

Since the additional U.S. sanctions began in May, cooperation with TSMC has been cut off, and Huawei can no longer produce its own semiconductor chips like Kirin.

Charlie Dai, an analyst at Forrester, predicted, "The new U.S. sanctions will severely impact Huawei's supply chain," especially affecting the procurement of semiconductor chips used in smartphones, cloud sectors, and innovation research facilities scattered worldwide.

Some experts point out that in the extreme situation of U.S. sanctions, the only realistic hope Huawei can expect ironically lies with the U.S.

This would be through the U.S. government granting transaction permits, allowing American semiconductor companies like Qualcomm to supply the semiconductor components Huawei needs. Since the sanctions imposed by the U.S. government began in May last year, transactions between U.S. semiconductor companies and Huawei have almost ceased.

There is also analysis that these sanctions are not pessimistic in the long term. Gary Yang, partner at Beijing-based venture capital firm Sky9, explained, "Many restrictions on Huawei do not mean the company's end," adding, "They only make trading with U.S. suppliers and technology and chip transactions more difficult."

This content was produced with the assistance of AI translation services.