Inside China Tech | Why the US may be supercharging China’s tech ambitions with its Huawei ban

The US Commerce Department placed Huawei and 70 of its affiliates on a blacklist in mid-May, a move that banned US companies from doing business with the Chinese telecoms gear giant without permission.

Since then, American companies have scrambled to figure out the legal boundaries of their compliance. From Google and Microsoft to Qualcomm and Intel, the line-up of US suppliers laid bare the reliance that Huawei, and by extension, China, has on American technology.

So when President Donald Trump said over the weekend at the G20 meeting in Osaka, Japan, that he was relaxing the ban on Huawei, one can imagine the collective sigh of relief at the Chinese company’s Shenzhen headquarters. But American companies too will be keeping their fingers crossed that the mercurial US leader will deliver.

That is because beyond the resumption of an important source of revenue for American tech companies, a relaxation of the trade ban may remove the impetus for Huawei to roll out a proprietary backup operating system for its phones, tablets and other devices, and blunt the pace of developing its own semiconductors.

Although counterintuitive, the US may be prolonging its lead in software and hardware over China by relaxing the ban as opposed to going all out to try and crush would-be challengers.

But as a Chinese saying goes, even a rabbit will bite when cornered, and Huawei is no rabbit.