According to a new report from Reuters, President Donald Trump might be readying an executive order that will ban the use of telecommunications equipment from Huawei and ZTE in the United States. The U.S. government is afraid that the two firms are working with the Chinese government, and that they could be spying on Americans.
It's the latest blow for the two firms. Huawei's CFO was recently arrested in Canada by request of the United States, and both Verizon and AT&T have agreed to not sell the company's smartphones. ZTE, on the other hand, was found to be selling its handsets in Iran, causing a ban on American companies selling any components to the Chinese firm.
Smaller operators do use a lot of equipment from Huawei and ZTE, and they're afraid that they're going to have to buy all-new equipment without any type of compensation from the U.S. government, according to the report. It will cost nearly a billion dollars to replace all of it. But it also has a lot to do with upcoming networking infrastructure, mainly 5G.
With the 5G rollout imminent, the United States is going to see one of its largest networking infrastructure improvements in history. With so much new equipment being added, the government doesn't want it to come from China.
The order would use the International Emergency Economic Powers Act, which allows the president to make such changes in a national emergency. No parties involved have commented on the matter, including Huawei, ZTE, and the U.S. government.