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Japan firms concerned about Huawei exclusion by U.S.

  • May 16, 2019
  • , Jiji Press , 9:17 p.m.
  • English Press

Tokyo, May 16 (Jiji Press) — Japanese manufacturers are rushing to collect information on a decision by Washington to basically prohibit U.S. companies from trading with major Chinese telecommunications equipment maker Huawei Technologies Co.

With Huawei products using many parts from Japan, Japanese companies are concerned about the impact on their operations from the U.S. move.

If the Japanese government follows in the footsteps of the United States, Japanese firms are expected to suffer a blow to their earnings, analysts said.

The U.S. Department of Commerce announced Wednesday that it will ban domestic firms from supplying parts to Huawei without government permission. Violators could be fined.

On the same day, President Donald Trump signed an executive order to prohibit the use of foreign communications equipment that could seriously jeopardize U.S. national security, apparently targeting Huawei.

While the ban covers U.S. companies, Japanese firms need to confirm whether penalty would be imposed if they supply Huawei with products using U.S.-made parts, sources familiar with the situation said.

An official of Japanese electronics giant Panasonic Corp. <6752> said that it is currently checking details.

“We’re closely watching the situation,” an official of major electronic parts maker Kyocera Corp. <6971> said, while declining to comment on specific business partners.

An official of Japan Display Inc. <6740>, which is struggling to rebuild its operations, said that the company would face difficulties if it is unable to supply products using U.S.-made parts.

Electronic and other parts made by such Japanese firms as Kyocera, Murata Manufacturing Co. <6981> and Sumitomo Electric Industries Ltd. <5802> are used in Huawei’s smartphones and telecommunications base stations.

Huawei procured 6.6 billion dollars’ worth of parts from Japan in 2018. The amount is estimated to reach 8 billion dollars this year.

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