INTERNATIONAL – The US is considering cutting off the flow of vital American technology to five Chinese companies including Megvii, widening a dragnet beyond Huawei to include world leaders in video surveillance as it seeks to challenge China’s treatment of minority Uighurs in the country’s west.
Chinese offshore yuan erased earlier gains after Bloomberg’s report. Shares of Hikvision and Dahua plunged in Shenzhen after the New York Times first reported on the potential ban. Both companies have been accused by human rights groups of facilitating Beijing’s persecution of the Uighurs, a Muslim ethnic group, in the western region of Xinjiang. The Trump administration however has held off on taking action because of sensitive trade negotiations with China, the people said.
The latest threat will elevate fears in Beijing that President Donald Trump’s ultimate goal is to contain China, triggering a cold war between the world’s biggest economies. In addition to a trade fight that’s rattled global markets, Washington has pressured allies and foes alike to avoid using Huawei for fifth-generation networks that will power everything from self-driving cars to robot surgery, forming the backbone of a modern economy.
In a draft letter to Trump dated May 22, Republican Senator Ted Cruz of Texas argued that exporting technology to the Chinese companies not only runs “counter to the foreign policy of the United States, but the stated values of the American companies” involved in the deals.
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