The Trump administration is looking to ban the transfer of US technology to China in areas in which the country is pulling ahead of the US.
In its attempt to block China’s access to US technology, the Trump administration is also seeking to reduce the involvement of Chinese nationals in the US’s advanced technological projects.
US companies need to secure deemed-export licenses from the US Department of Commerce before hiring foreign nationals to work on certain sensitive technologies, most of which are related to semiconductors and telecommunications.
The number of licenses issued to Chinese nationals to work in the US on certain critical technologies fell to a six-year low of 350 in 2018 from 771 in 2017.
This move is harming US companies, especially semiconductor companies such as Intel and Qualcomm (QCOM), as their major talent pool is Chinese.
On the other hand, China is making efforts to bring the Chinese talent pool back home in order to accelerate its technology development.
The US technology ban on Huawei will slow the Chinese company’s development in the short term, but it will encourage Huawei to reduce its dependence on US technology and develop its own technology.