Taiwan's Ministry of Economic Affairs has added Huawei and SMIC to its newly updated export control list, requiring domestic firms to secure a license from the Bureau of Foreign Trade before shipping goods to either company. However, Taiwanese suppliers of Huawei smartphone components say the rule has little immediate impact, as most shipments are currently fulfilled from manufacturing sites located in mainland China.
Swift implementation catches industry off guard
Implemented without prior notice, the new regulation requires Taiwan Customs to detain any goods bound for Huawei or SMIC that lack an approved export license. Authorities have been instructed to block non-compliant shipments at the border.
Key Taiwanese suppliers of components for Huawei smartphones and tablets have reacted cautiously, confirming they've already consulted with government agencies. They verified that products manufactured and shipped from China-based facilities remain unaffected by the new controls.
Huawei's supply chain tightens amid growth
Suppliers noted that Huawei's rapid shipment growth in recent years has been accompanied by increasingly rigid supply chain policies. The company strictly prohibits vendors from working with rival brands and enforces tight confidentiality over order and shipment information.
Industry sources noted that Huawei has been stepping up efforts to localize its component supply, leaning more heavily on Chinese vendors. Although Taiwanese firms initially held a sizable share of orders, their role has gradually diminished as Huawei deepens ties with domestic partners. Despite this shift, contractual terms still limit some Taiwanese suppliers from reallocating capacity to alternative clients.
Geopolitical shifts reshape manufacturing landscape
Companies added that mounting geopolitical pressures are prompting US firms to exit China-based production, which in turn has left Taiwanese manufacturers increasingly dependent on Chinese clients—including Huawei—to keep local capacity running.
Despite shifting dynamics, Huawei remains a top-tier customer for Taiwanese component makers due to its strong brand presence in China. The company's strategy of maintaining multiple suppliers aligns with broader industry norms, ensuring continued engagement from qualified vendors.
Article translated by Levi Li and edited by Jerry Chen
