GERMANY - Infineon is the first German company to be caught between the firing lines of the US economic war against China. Yesterday, the Trump administration began to enforce the implementation of its boycott against the Chinese Huawei telecommunication group that it had announced just last Wednesday. The US government seeks to ruin one of China's major companies, Huawei, to prevent the continued rise of People's Republic.
Infineon is now forced to halt its supplies of USA-produced components to Huawei. A serious conflict with Beijing would be fatal for the company. One-quarter of Infineon's sales are currently generated in China - significantly more than in any other country. It is also engaged in major future-oriented projects in that country. Observers warn that the Trump administration could force the German industry to choose between the USA and China - as in the case with Iran. The DAX companies generate nearly 22 percent of their sales in the USA and 16 percent in the People's Republic.
It is, of course, also conceivable that the US economic war will backfire. Commentators are warning that Germany's entire economy may arrive at a situation, where they - like Infineon and Deutsche Telekom - must choose between the USA and China. Regardless, one thing is clear, "no one knows yet, how far Trump is prepared to go to retard China's further emergence."