US threatens to block China Telecom from operating in American market

The top departments of the US government support cutting off Beijing-controlled China Telecom from serving the US market because of legal and security risks, the Justice Department announced Thursday.

The departments, including Defense, State, and Homeland Security, "unanimously recommended that the Federal Communications Commission revoke and terminate China Telecom (Americas) Corp.'s authorisations to provide international telecommunications services to and from the United States," the Justice Department said.

"The Executive Branch agencies identified substantial and unacceptable national security and law enforcement risks associated with China Telecom's operations, which render the FCC authorizations inconsistent with the public interest," it said.

Earlier, Chinese telecom giant Huawei ran into trouble with the US government over several issues. 5G technology, security issues were some of the concerns of the US government with Huawei. US government imposed several restrictions on the company and China retaliated. 

Huawei warns against new US trade restrictions

Huawei warned on Tuesday that 2020 would be its most difficult year yet due to American trade restrictions which dealt a blow to its overseas sales in 2019, and predicted the Chinese government would retaliate against the United States.

The world's largest maker telecoms equipment issued the warning as it reported its weakest annual profit growth in three years. It said Beijing could hit back against US measures to restrict chip sales to Huawei, by restricting sales of American products in China and by shifting to alternative suppliers in China and South Korea.

"The Chinese government will not just stand by and watch Huawei be slaughtered on the chopping board," Chairman Eric Xu told reporters at the launch of Huawei's annual report.

"Why wouldn't the Chinese government ban the use of 5G chips or 5G chip-powered base stations, smartphones and other smart devices provided by American companies, for cybersecurity reasons?"

The United States alleges the Chinese government could use Huawei's equipment to spy, an accusation rejected by the company.