The Trump administration will not say goodbye without a “farewell gift.”
Xiaomi recently faced unpleasant information as it put a company known for its smartphones on the U.S. blacklist. Xiaomi has specifically been classified as a military producer controlled by the CCP (Chinese Communist Party), which will result in them not being able to access US capital at a later date.
Under the decision, investors in the United States will have to terminate their previous investment agreements with Xiaomi by November 11, and the company will, of course, be excluded from future investments from the U.S.. Xiaomi, however, has access to U.S. technologies, so they haven’t been part of a commercial ban list like Huawei. In this respect, only US capital is withdrawn from the producer, which has no direct effect at the commercial level. Subsequent product development may in theory already run into problems, after all, some of the capital invested will be missing unless Xiaomi can make up for it from other sources.
The decision of the United States is extremely strange in that the company in question works primarily for the commercial market. Their main profile is consumer electronics, but they also manufacture lifestyle-enhancing devices. In this regard, the Trump administration placed on the blacklist for the first time a Chinese company that is not of paramount importance to the Eastern superpower from a national strategic point of view.
Xiaomi denies that the Chinese military would control the company or that they had anything to do with them. The possible consequences of the US decision are currently being assessed and the necessary steps will be taken after the evaluation, so these are not yet known.
It is worth noting that the Trump administration no longer has a week until his resignation, when Joe Biden will take over the presidency. This generates a general uncertainty about the whole story, as it is not yet entirely clear what Biden will do specifically in matters related to China.
Source: Hírek és cikkek – PROHARDVER! by prohardver.hu.
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