China’s ban on state employees and those employed by state-owned enterprises using Apple smartphones at work or for business has caused Apple’s sharemarket value to tumble by more than $US190 billion ($297 billion) last week. That may only be a foretaste of what’s to come.

The ban, first reported by the Wall Street Journal, came almost simultaneously with the surprise launch of a new smartphone by China’s Huawei, its first high-end processor since it was targeted for sanctions by the US in 2019, and one with features comparable to the latest generation of Apple’s devices.

The launch, made without much fanfare and ahead of its expected schedule, coincided with a visit to China by US Commerce Department secretary Gina Raimondo, which appeared to be deliberate.

It also, however, came ahead of this week’s launch of Apple’s latest phone, the iPhone 15. That also may not be a coincidence.

Between the unveiling of Huawei’s new product and the ban on use of iPhones by state-controlled or influenced organisations, China sends a potent message to the US that it does have the ability to retaliate for the sanctions on its tech sector.

It also sends a message to China’s consumers and an appeal to their patriotism. There is now, once again, a China-developed smartphone with equivalent capabilities to Apple’s products.

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The ban is thought to be likely to directly impact only about five million to 10 million of the 50 million or so devices Apple sells within China, which earlier this year became Apple’s largest market for iPhones, overtaking the US. It accounted for about 24 per cent of all iPhone shipments in the June quarter. The US absorbed about 21 per cent of shipments.

If, however, China’s consumers switch to Huawei’s devices in large numbers it would represent a far bigger threat to Apple’s $US400 billion or so of annual revenues, more than half of which are generated by the iPhone.

Apple was a major beneficiary of the US sanctions on Huawei. Before the sanctions were imposed, Apple had a global market share of about 15 per cent.

Today that share is almost 20 per cent, with most of the increase attributable to its sales in China, where the lack of access to advanced semiconductors caused Huawei’s smartphones business, once the global market leader, to shrivel.

Revenues from Huawei’s consumer businesses halved and its domestic market share slumped to less than 10 per cent as it was cut out of the market for high-end devices.

The excitement within China ignited by last week’s launch of the Huawei Mate 60 Pro (and