Following Huawei Technologies Co.’s ban last month by the US, last week China summoned foreign technology companies for talks according to sources privy with the matter.

Summons of foreign companies

The US blacklisted Chinese technology giant Huawei last month barring US companies from selling hardware and software to the phone maker. Washington has cited national security concerns as the reason behind the ban and this potentially dealt a blow the trade negotiations that were on-going at the time.

Beijing has also indicated that soon it will be releasing a list of unreliable foreign entities. Equally, it has shown intentions of limiting the supply of its rare earth minerals to the US.

An insider at Microsoft Corp (NASDAQ:MSFT) indicated that the session between the company and Chinese government officials was not a warning but rather a clarification to the company that is complying with bans will lead to complications thus affecting all sector players. The insider said that the tone of the discussions was soothing and the firm was requested to make decisions before the whole issue is fully understood hastily.

The meeting was first reported by the New York Times, which indicated that the National Development and Reform Commission lead them. The New York Times stated that foreign multinational tech companies were warned not to comply with the US directive of banning of selling American technology to Chinese companies or they could potentially face dire consequences. NDRC has, however, not commented on the issue of the summons.

Is China taking a softer stand on the trade wars?

The move of summoning a representative of domestic and foreign firms by China to make its views heard was an unusual one. A representative of another US company that was summoned said that the tone of the discussion was much softer than anticipated. In the discussions there was no mention of Huawei nor were ultimatums issued but the companies were asked to stay in the country and be part of the negotiations.

The person stated that it seems like China has realized that it needs US hardware and software products because self-sufficiency is something that will take longer.