The Donald Trump-led United States administration is considering to decline a proposal for a license that allows export of jet engines partly manufactured by General Electric to China. According to a report published by The Wall Street Journal, the United States fear that the Chinese could duplicate the technology used in the production of these engines and use it to manufacture it themselves. GE has opposed the proposal reportedly stating that the Chinese could have began reverse-engineering the engines long back as they are in use in the country from a long time.
According to the WSJ report, a proposal to decline the license that allows CFM International, a joint venture between General Electric and Safran SA that provides LEAP 1C Jet engines to China, to ramp up its supply is being considered in The White House. GE, while opposing the proposal as it may have a major impact on it, stated that the officials underestimate reverse-engineering. The Chinese have been using these engines from quite a while now and might have already started doing it. The United States Administration is expected to hold a meeting on Thursday to assess the proposal, while the cabinet officials have a meeting scheduled for 28th February to discuss all China trade issues. GE has a lot at stake as its aviation sector is dubbed as the only bright spot that could help generate some revenue for an otherwise struggling company.
Donald Trump has signed a trade deal with China a month ago to end the 18-month long trade war between the two countries that was creating a global economic slowdown. The trade deal hasn’t gone down well though so far, as China was hit with the devastating effects of the coronavirus soon after the deal was signed.
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