Huawei will halt production of smartphone chips due to US sanctions.

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Chinese telecoms giant Huawei said production of its most advanced smartphone chips would halt in September due to US sanctions, causing a “huge loss.”

The telecommunications giant is the world’s largest producer of telecommunications network equipment. It has become a pivotal issue in the geopolitical standoff between Beijing and Washington, which claims the company poses a significant cybersecurity threat.

Huawei’s Chief Executive Officer Yu Chengdong told a tech industry forum on Friday that production of the company’s high-end Kirin 9000 chipset would halt as of Sept. 15 due to U.S. sanctions.

Washington last year cut off Huawei’s access to American components and technology, including Google Music and other smartphone services.

Those restrictions were tightened in May when the White House banned suppliers around the world from using American technology to produce components for Huawei.

Taiwan Semiconductor Manufacturing Co. (TSMC), which has been making Kirin 9000 chips using American equipment, has stopped receiving orders from Huawei since May for fear of possible repercussions.

Huawei does not have the capacity to manufacture the chips, which were used in its high-end smartphones.

“Huawei’s mobile phones have no chip supply, which makes our shipping volume this year just under 240 million units (shipped last year),” Yu said. “This is a great loss for us.”

Washington has also launched a diplomatic campaign to isolate the Chinese company, which has become a pioneer in the global race to implement 5G telecommunications infrastructure.

The British government gave in to mounting pressure from the United States and pledged earlier this month to remove Huawei from its 5G network by 2027, despite warnings of retaliation from Beijing.

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Australia and Japan have also taken steps to block or restrict the Chinese company’s participation in its 5G launches, while European telecom operators, including Norway’s Telenor and Sweden’s Telia, have bypassed Huawei as a provider.

[AFP]

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