For most phone manufacturers, this would be something near to a death blow, but since Huawei is large enough to set up a rather competent app marketplace of its own, as well as being able to create its competent equivalents of Google's services.
This has the effect of creating a parallel ecosystem for the Android operating system, which means that, because the OS is open source, Google is at risk of losing much of its control over Android, including its ability to spy on millions (billions?) of users.
So, Google has gone to the Trump administration hat in hand to roll back the sanctions and bring Huawei back into the fold:
As Huawei takes the initiative to create its own homegrown alternative to the Play Store, Google has reportedly pleaded with the White House to offer it an exemption to again work with the Chinese tech giant.I'm kind of hoping that the request for a waiver is denied, because anything that hurts Google is good for the rest of us.
Huawei's inclusion on the Trump administration's Entity List has had dramatic consequences for the company's handset business, preventing it from using Google Mobile Services (GMS) on its latest phones and tablets.
According to German wire service Deutsche Press Agentur, Android and Google Play veep Sameer Samat has confirmed that Google has applied for a licence to resume working with Huawei.
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Huawei has said that if Google got an exemption, it would promptly update its newest phones to use Google Mobile Services.
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That said, Huawei's strategy has focused on hoping for the best, but preparing for the worst. These preparations have seen the firm invest over $1bn on its app ecosystem, with more than 3,000 engineers working on the AppGallery, according to a statement from the company released earlier this week.
It has also made deals with Western app developers and content providers, most notably Sunday Times publisher News UK, to make its services appear less barren.
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Huawei has also introduced the ability to download progressive web apps, dubbed "Quick Apps" by the firm, through the AppGallery, which should bump up the app availability numbers – even if they lack the sophistication of a dedicated native app.
It's likely this that has motivated Google to take the initiative. Although losing Huawei as a customer is a significant financial body blow to Mountain View, given its enduring popularity in Europe and Asia, it would pale compared to the damage caused by a new product that starts to loosen its stranglehold on the Android sphere.
Google Mobile Services can cost as much as $40 per device, and it's likely that many phone vendors, particularly on the cheaper end of the spectrum, would welcome a less-expensive alternative.
Complicating matters for Google, the biggest Chinese phone manufacturers (Oppo, Xiaomi and Huawei) have teamed up to simplify the process of deploying apps to their in-house stores.
With Google claiming a cool 30 per cent on all Play Store sales, this represents a huge threat to its bottom line.
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