Huawei was just the tip of the sanctions iceberg. Oh Joy!

sanctions

Huawei is just the first of many, many companies that are hoping against hope that the US trade war with China doesn’t get any worse. They may be disappointed.

It is never particularly entertaining to watch someone shoot themselves in the foot. But when you watch one of the world’s apparently grown up superpowers do it and then, having done it, do it again, it tends to fry the mind.

Huawei may have a temporary lull in the war against it in the US but it is only temporary and seems to have allowed the administration to search for other targets.

Huawei, it seems, is far from being alone. Surveillance firm Hikvision looks like it is next in the US sights.

It is understandable that countries need to be very sure about national security but this must be balanced by an assessment of the damage this unhelpful trade war will do to its own companies, let alone its economy.

Apple assembles its iPhones in, ah yes, China. If this trade war escalates and China says that Apple cannot use China based companies will cause enormous damage to all parties (except, perhaps, political ones).

iPhones will either get more expensive as Apple has to use home grown parts and labour or the company will have to absorb the extra cost and take a pretty substantial profit hit. They could, of course, head to Mexico or somewhere. Oh, no, wait, they would have to climb over a wall to get there.

Meanwhile the large ecommerce outfits of the US, Amazon in particular, are trying to somehow address the Chinese market. The current circumstances, to say the least, will not be helpful.

Google seems to all but have given up on the attempt to get into the Chinese market.

Many executives are now extremely worried that the next battle front will be tech, a naturally global industry.

Companies from all sectors are appealing to stop the whole thing, companies as diverse as lobster fishermen to shoe manufacturers. They are scared of the huge damage it will do, in an economic climate that is fragile at best.

You would have thought that common sense would prevail.

But when the President of the United States declares that imported cars pose a security threat, common sense doesn’t even get a seat at the table.

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