23:39 GMT26 February 2020
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    In his annual State of the Nation address on Tuesday, President Donald Trump praised the state of relations between the US and China as “perhaps the best…we have ever had,” and said that the Phase One trade agreement recently signed between Washington and Beijing had succeeded in confronting China’s alleged “massive theft of American jobs.”

    Senior Trump administration officials plan on meeting with their Chinese counterparts later this month to discuss impending new restrictions against Chinese technology giant Huawei and the US relationship with the Chinese technology sector in general, Reuters has reported, citing two sources said to be familiar with the matter.

    The meeting, scheduled for 28 February, will include a discussion on the recently leaked plans by the US Commerce Department to introduce new rules meant to further reduce US technology-related shipments to Huawei, one of the sources said.

    On the US side, the gathering is expected to include Secretary of Commerce Wilbur Ross, Secretary of State Mike Pompeo and Secretary of Defence Mark Esper. The Chinese officials expected to be present were not named.

    Tech War vs. Economic Bottom Line

    US tech giants including Microsoft, Intel, Google and others have each expressed fears that restrictions against Huawei and other Chinese technology companies could lead to billions of dollars in lost exports. The Commerce Department blacklisted Huawei in May 2019 over alleged threats to US national security, but has repeatedly issued waivers to allow US firms to continue doing business with the company.

    Members of the media film the new iPhone 7 at an Apple store in Beijing, China, September 16, 2016
    © REUTERS / Thomas Peter
    Members of the media film the new iPhone 7 at an Apple store in Beijing, China, September 16, 2016

    Recently, it was reported that the Commerce Department has been seeking to expand its legal powers to curb tech shipments to China, but has faced resistance from other departments in Washington, prompting an inter-agency review. The Commerce Department reportedly put the finishing touches on the new rules in December.

    Under present regulations, Washington has the ability to ban American companies from selling potentially sensitive technology directly to firms on the so-called entity list. However, it has little control over how foreign companies manage technology of foreign origin. This has led to Huawei and other Chinese companies quickly finding replacements outside the US market, limiting the entities list’s effectiveness. Proposed changes would expand US authorities and allow the Commerce Department to forbid foreign companies from selling American-made software or technology to listed firms.

    Last week, in defiance of the Trump administration, Washington’s British allies formally granted Huawei the right to build part of the UK’s 5G mobile internet network, joining Germany, France and other US allies in rejecting US pressure against the Chinese tech giant.

    The meeting on Huawei follows the signing of the so-called Phase One trade deal signed last month, which committed Beijing to the purchase of some $200 billion in US agricultural and manufactured goods, energy and services. The Trump administration has promised to keep up tariff pressure until a second and final phase of the agreement can be signed.

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