The Trump administration widened its dragnet this week on Chinese companies barred from selling to the U.S. or buying components from American firms in a push to slow China’s technological advances. After crippling Huawei Technologies Co., China’s biggest telecommunications company, the administration followed up by threatening to cut off U.S. components or software to five Chinese video surveillance firms.
But the plan might backfire, because U.S. companies are so inextricably involved in the global technology supply chain. Concerns over Washington’s punitive measures and possible retaliation by the Chinese rattled markets throughout the week, hammering chipmakers and Apple Inc.
It’s 5G that embodies most of Washington’s fears — by powering a wealth of upcoming technologies from self-driving cars to advanced medical procedures, the new wireless standard is set to be the backbone of the modern economy. Until recently, it seemed like Huawei, the world’s biggest purveyor of communications networking gear and the second-largest smartphone maker, was leading in supplying that infrastructure.