Commerce Secretary Says 'No Reason to Believe' Huawei Will Be Removed From Entity List

Commerce Secretary Gina Raimondo suggested her agency has no plans to remove Huawei from the Entity List and said she will aggressively use trade tools to compete with China. But she also said she will prioritize efforts to invest in U.S. technology industries over imposing more export restrictions. “My broad view is what we do on offense is more important than what we do on defense,” Raimondo told reporters April 7. “To compete in the long run with China, we need to rebuild America in all of the ways we're talking about.”

Raimondo said export restrictions, including the Entity List, are “defense,” and she is instead focusing on the U.S.’s offensive tools, including investments in domestic semiconductor manufacturing. The semiconductor industry has warned Commerce against imposing unilateral export restrictions and has advocated for tax credits and other government incentives that could help spur innovation and keep U.S. technology companies ahead of China (see 2102120008 and 2104060045). “We all know semiconductors are the building blocks of our future economy,” Raimondo said. “We’re living through a global chip shortage. We're seeing that hurt businesses in every sector, and so we need to strengthen our domestic supply chains.”

But Raimondo also said defensive tools may be necessary to address China’s “uncompetitive, coercive and underhanded” actions, and Commerce will continue to maintain restrictions against Huawei. “A lot of people have said, is Huawei going to stay on the Entity List?” she said. “I have no reason to believe that they won't.”

And although Raimondo stressed that the best way to compete with China may be through domestic investments, she also said she won’t hesitate to use Commerce’s tools when warranted. China has “proven they'll do whatever it takes,” she said. “And so I plan to use all the tools in my toolbox as aggressively as possible to protect American workers and businesses from unfair Chinese practices.”

She said Commerce is still working with the White House and other agencies on a comprehensive review of the U.S.’s China policies, which began in January (see 2101250049) and is expected to cover a range of trade restrictions, including sanctions and export controls. She said the process is being “led” by National Security Adviser Jake Sullivan. “I would say we're in the thick of it right now,” Raimondo said. “We're working as aggressively as we can. We're not wasting time on it.”