New report has it that Huawei and ZTE are both slowing down the development of their 5G base stations in China as a result of ban from the US government prompting an uncertain future to the key supply chain of the Chinese tech giants.
Both Huawei and ZTE make up for nearly 80% of all base stations contracts in China making them the forerunner into the transition into the future 5G which everyone is anticipating. Also the slow down in the expansion of 5G infrastructure signals that the recent US export sanction has started taking a toll on the Chinese firms. Chinese carriers’ investment strategy with 5G also accounts for the slow down as well.
Meanwhile both Chinese tech giants are known to be working on re-designing a few of their 5G products which is being done in order to remove US parts as much as it can according to a report gotten from Nikkei which stated that both companies have informed suppliers to slow down shipments of certain 5G base station related products way back since June 2020. ZTE told a supplier to slow down shipments in June, with orders coming to a near standstill in July.
Huawei on the other hand is doing almost the same as it stated to be changing some designs as well as replacing certain equipment which are being used in its manufacturing process. Also, as the monsoon season began hitting the southern part of Chin which had cased flooding, all these scenarios had caused a slow down in the development of 5G in the part of the region
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US government under Trump’s administration had taken on some Chinese tech companies since last year with heavy sanctions affecting their production and trade relationship ultimately. Huawei and ZTE are just one of those with the former losing it’s license to work with Google as well as being unable to sell it’s smartphones in the region.