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Illustration: Aïda Amer/Axios

The U.S.'s blunt policy of walling itself off from Huawei could backfire, making the Chinese telecom giant even stronger in the long term.

Why it matters: The grand decoupling of American and Chinese tech amid trade tensions and cybersecurity concerns, of which Huawei is at the center, is pushing China's companies to become increasingly self-reliant. Huawei's progress could position it to take the lead in the global U.S.-China tech race, experts say.

  • "We could end up ceding ground to global Chinese companies if the United States increasingly fences off access to its tech sector, isolating itself from where innovation is happening around the world," says Samm Sacks, an expert on China and cybersecurity at New America.

Driving the news: The Commerce Department barred American firms from selling to Huawei computer chips that are crucial to building base stations for its new 5G wireless networks — but the Chinese company is learning to live with the ban, Tim Danks, a U.S.-based Huawei executive, told Yahoo Finance.

  • Per Danks, Huawei sold 50,000 base stations that contain no U.S.-made technology in the fourth quarter of 2019.
  • Huawei still wants to go back to using U.S. tech, Danks told Yahoo Finance.
  • And, in the short term, the ban is hurting the American companies who supply Huawei with chips, too. "While it's impacted Huawei and nobody can say it hasn't impacted us to some degree … it's hurting Americans at this point more than it's hurting Huawei," Danks told Axios' Ina Fried at the RSA conference last month.

Yes, but: China had already begun a move toward tech independence long before the U.S. ban on Huawei, building expertise in chips and software to become less reliant on the West, and the U.S. in particular.

The big picture: As Huawei keeps building out networks, even without U.S. chips, it's making headway all over the globe — and bringing Beijing's vision for the internet with it. "We can blacklist companies in this country and wall them off, but they’re going to continue to gain ground in markets across Europe and Asia," Sacks says.

  • The U.K. has agreed to let Huawei build part of its 5G network, despite the U.S. urging against it. Switzerland has also welcomed the Chinese giant.
  • Those are just two of a slew of countries in Africa, Asia, Europe, South America and beyond that have partnered with Huawei.

What to watch: American companies are making strides in 5G, but have yet to provide the world with a compelling alternative to Huawei, says Sacks. Its chief competitors in the 5G market are Ericsson and Nokia.

Still, China has not secured a definitive lead, Jim Lewis, a fellow at the Center for Strategic and International Studies, said at a Senate hearing on Wednesday.

  • "The U.S. is well-positioned to take advantage of 5G technology, just as it did with 4G," Lewis said. "The difference this time is we have real competition, a competitor who is well-resourced, with a strong technology workforce, and a long record of unscrupulous behavior."
  • But to beat out Huawei, America must do more than cut the company off from U.S. technology and urge allies to reject it, Sacks says. "If we take this purely defensive posture, I don’t see how we advance."

Go deeper

Updated 6 hours ago - Sports

The potential GOAT of chess faces intriguing challenger

Illustration: Sarah Grillo/Axios

The World Chess Championship between Norway's Magnus Carlsen and Russia's Ian Nepomniachtchi began on Friday, 1,094 days after Carlsen won his fourth consecutive title.

Why it matters: During the long, COVID-fueled layoff, chess entered a new era, and with the championship finally here, the age-old game is ready for its close-up.

Department of Interior proposes raising cost of drilling on public lands

A horizontal drilling rig and a pump jack sit on federal land in Lea County, New Mexico. Photo: Callaghan O'Hare/Bloomberg via Getty Images

Oil and gas companies should pay more to drill on federal lands and waters, the Department of the Interior argued in a report released Friday, saying that the current rates were "outdated."

Driving the news: The Department of Interior report said that the federal government's oil and gas leasing and permitting program "fails to provide a fair return to taxpayers, even before factoring in the resulting climate-related costs that must be borne by taxpayers."

8 hours ago - Health

U.S. to restrict air travel from 8 countries over new COVID variant concerns

A COVID-19 vaccine is administered. Photo by Joe Raedle/Getty Images

The U.S. will impose new air travel restrictions in response to the Omicron variant, a new COVID strain first detected in South Africa, President Biden announced Friday.

The big picture: Air travel from South Africa, Botswana, Zimbabwe, Namibia, Lesotho, Eswatini, Mozambique and Malawi will be restricted starting on Monday.