Saturday, April 28, 2018

Banning ZTE from using US chips

ZTE is not well known in the US, but in the rest of the world. It has a lot of researches and high-tech products.

The founder and many others graduated in US, the west and/or Australia colleges, worked there for a while before they moved back to China (known as sea turtles) and formed their own companies.
They had government incentives, less regulations plus a lot of cheap engineers (Huawei has many times of engineers as Cisco). This is the first wave and the current wave is still great for them but with less incentives.

Preventing ZTE to buy US chips leads us to more trade deficit. We stop China from buying our dual-purpose products while China can buy them from Europe / Russia. Does it make economical sense?

ZTE will build their own chips to replace those from US. It will be a short-term pain but a long-term gain.

Is Huawei be the next target?

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