Beijing is striking back against the U.S.’s export ban against Huawei and affiliates with an “unreliable entity list” of its own. The Chinese Commerce Ministry hasn’t revealed specifics yet, but it’s expected to target companies that have complied with the U.S. Department of Commerce’s orders thus far.
The list of “unreliable” entities will target foreign entities who violate market rules and the spirit of contracts, as well as those who cut their supply to Chinese companies for nonbusiness reasons, according to the announcement by the Chinese Commerce Ministry.
The list could impose significant restrictions, such as the inability to import Chinese rare-earth metals. China has to think carefully about who it bans, however, as its own supply chains would suffer by the loss of business.
“The symbolism of announcing this and … hitting back is what motivated the Chinese” to announce such a move, said Wendy Cutler, vice president at the Asia Society Policy Institute and a former U.S. trade negotiator. “It seems like they are looking for a proportional response,” Cutler said. But real effects of the blacklist remain uncertain: “If they administer this in a sweeping manner or in a very limited manner — unclear at this point.”