China has imposed on government agencies and public institutions to replace all foreign computer hardware and software with Chinese alternatives within three years, reports business newspaper Financial Times.
The new rules would be known as “3-5-2” in China. By 2020, public authorities and governments must have replaced 30 percent of the equipment and software. A year later another 50 percent will follow and in 2022 the last 20 percent must be replaced.
Analysts expect the situation to have a major impact on US companies such as Intel, HP, Dell and Microsoft. These companies have been supplying products to the Chinese government for years. It is not known whether Chinese authorities will be able to replace their equipment in the short term. Many governments already use computers from the Chinese Lenovo, but parts from American manufacturers are used for this.
Private companies would not have to comply with the new rules for the time being. According to Financial Times, they can continue to use foreign products.
Excluding US equipment may be a response to measures that the US has previously taken. Earlier this year, US President Donald Trump introduced a ban on trade with Chinese companies.
For example, American companies are not allowed to purchase devices from Huawei, because the company is suspected of espionage for the Chinese government. However, the US government has never proved this.
Nicholas de Krammer, а self-taught economic analytic with heave mathematical background. Math behind the economics (and economics behind math) is the strong side of the author. Contact him at email@example.com