Xiaomi suffers US blacklist sanctions, but it is not as bad as Huawei… yet

In another blow to the consumer tech industry, the US government has blacklisted Xiaomi along with eight other companies from receiving US investment.

This continues the prolonged political dispute with the US and China, which has led the US to place very severe restrictions on Huawei.

The new restrictions placed on Xiaomi are relatively mild in comparison, there are no restrictions in who can trade with them or import restrictions for Xiaomi products. This blacklist will force American investors to divest their holdings of the blacklisted firms by Nov. 11, 2021.

However, the US government implemented increasingly harsh restrictions on Huawei, and there is no guarantee this won’t happen with Xiaomi.

It is difficult to keep up with what Huawei can and can not do nowadays, but US companies are not allowed to conduct business with Huawei unless they apply for a special exception. This has led to Huawei being unable to use Google services and struggling to get chipsets developed with TSMC.

I won’t get into the politics of China, but so far the claims against Huawei appear to have limited evidence and none of it related to their consumer side. The sanctions are politically motivated against China.

This new blacklist against Xiaomi appears to be even more baseless with no meaningful reason for it other than them being a Chinese company. Xiaomi has much of there investment from international sources so they are hardly some puppet of the Chinese government.  

The result of this new ban has seen Xiaomi share price tumble 11%.

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