As the trade dispute with China continues to escalate, the Trump administration hit Chinese telecoms giant Huawei with severe sanctions on Wednesday, adding another volatile element to the already incendiary U.S.-China trade dispute.

The Commerce Department added Huawei Technologies and 70 affiliates to its “Entity List”– a move that bans the firm from buying vital components and technology from U.S. firms without government approval on national security grounds.

In a statement, Commerce Secretary Wilbur Ross said that President Trump backed the decision to “prevent American technology from being used by foreign-owned entities in ways that potentially undermine U.S. national security or foreign policy interests.”

President Trump earlier in the day signed an executive order barring U.S. companies from using telecommunications equipment made by firms deemed to pose a national security risk.

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Huawei, which denies its products pose a security threat, said it was “ready and willing to engage with the U.S. government and come up with effective measures to ensure product security.”

The company said that restricting Huawei from doing business in the United States would “limit the U.S. to inferior yet more expensive alternatives, leaving the U.S. lagging behind in 5G deployment and eventually harming the interests of U.S. companies and consumers.”

With revenues last year of $105 billion, and Huawei’s focus on telecoms infrastructure equipment and high-end phones, analysts believe the impact of an export ban will have major consequences.

China’s Finance Ministry announced earlier this week that it was increasing tariffs on about $60 billion worth of U.S. products to 25%, up from 10%, in retaliation to the U.S. decision to raise duties on Chinese goods.

The increase would affect more than 5,000 goods, including cotton, aircraft parts, grains, and machinery, and goes into effect on June 1, according to the Ministry.

Treasury Secretary Steven Mnuchin said he would visit China soon for additional high-level talks, but did not say when the trip will take place.

“My expectation is that we will go to Beijing at some point in the near future to continue those discussions,” Mnuchin said. “There’s still a lot of work to do.”

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