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FOCUS-U.S. chipmakers quietly lobby to ease Huawei ban -sources

Credit: REUTERS/Aly Song

Huawei's American chip suppliers, including Qualcomm and Intel, are quietly pressing the U.S. government to ease its ban on sales to the Chinese tech giant, even as Huawei itself avoids typical government lobbying, people familiar with the situation said.

By Stephen Nellis and Alexandra Alper

SAN FRANCISCO/WASHINGTON, June 16 (Reuters) - Huawei's American chip suppliers, including Qualcomm and Intel, are quietly pressing the U.S. government to ease its ban on sales to the Chinese tech giant, even as Huawei itself avoids typical government lobbying, people familiar with the situation said.

Executives from top U.S. chipmakers Intel INTC.O and Xilinx Inc XLNX.O attended a meeting in late May with the Commerce Department to discuss a response to Huawei's placement on the black list, one person said.

The ban bars U.S. suppliers from selling to Huawei, the world's largest telecommunications equipment company, without special approval, because of what the government said were national security issues.

Out of $70 billion that Huawei spent buying components in 2018, some $11 billion went to U.S. firms including Qualcomm, Intel and Micron Technology Inc MU.O.

In an interview in Mexico, Andrew Williamson, vice president of Huawei's public affairs, said the company had not asked anyone specifically to lobby on its behalf.

"They're doing it by their own desire because, for many of them, Huawei is one of their major customers," he said, adding that chipmakers knew that cutting Huawei off could have "catastrophic" consequences for them.

China watchers say U.S. suppliers are essentially trying to thread the needle - not wanting to be seen as aiding an alleged spy, thief and sanctions violator, but fearful of losing a good client and encouraging it to develop supplies elsewhere.

"Huawei is at a loss over what they should do next," said Jim Lewis, a cyber expert with Washington's Center for Strategic and International Studies. "It is in a really bad position in the U.S. Nobody is looking out to do Huawei a favor."

Even so, the ban has had real repercussions.

(Reporting by Alexandra Alper in Washington and Stephen Nellis in San Francisco; Additional reporting by Diane Bartz in Washington, Karen Freifeld in New York and Jennifer Saba in Shenzhen, China; Editing by Chris Sanders and Leslie Adler)

((Alexandra.Alper@thomsonreuters.com; +1(202)354-5865; Reuters Messaging: alexandra.alper.thomsonreuters.com@reuters.net - https://twitter.com/alexalper?lang=en))

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