Xiaomi is one of nine Chinese companies that have been added to a military blacklist by the USA’s Department of Defence.
Other companies added to the list include aviation firms Comac and Skyrizon.
By adding these companies to the blacklist, the US has designated them as owned by the Chinese military. American investors with shares in the companies must divest their shares by November 11. The blacklisting does not affect Xiaomi’s ability to use Google Mobile Services.
In a tweet Xiaomi denies any links to the Chinese State or military, with the vendor vowing to “take appropriate action to protect the interests of the company and stakeholders”.
— Xiaomi (@Xiaomi) January 15, 2021
The smartphone manufacturer has had a relatively successful 2020 in what was a poor year for handset sales, becoming the third-largest manufacturer by global market share for the first time, according to Canalys, IDC and Counterpoint Research.
Meanwhile, harsh US sanctions against Huawei have seen it suffer outside of its domestic market, and in November it sold its Honor sub-brand. Analyst firm TrendForce predicts that Huawei will drop out of the top six smartphone manufacturers this year.
The US government’s action, part of a series of policies by outgoing President Donald Trump to appear tough on China, has already fulfilled one of the analyst firm CCS Insight’s 2021 predictions.
Last October, CCS chief of research Ben Wood said that the US would play “whack-a-mole” with Chinese tech companies, having “neutered Huawei’s global ambitions”.
However, it is not clear whether or not President-elect Joe Biden will take a similar stance on Chinese companies to that of his predecessor.
