Huawei can prosper despite US sanctions, says board member | Huawei

Huawei was forced to adopt the mentality of a startup due to sanctions from the US government, among other things, said Catherine Chen, board member of the Chinese telecommunications company.

Helping run what is probably the most controlled company in the world, she said Huawei would survive and eventually break free from the US shackles by using its technical expertise to pave a path into new markets, that are less dependent on the US, such as energy saving, artificial intelligence and electric cars.

Speaking to the Guardian in Shenzhen, Chen said, “We are now in a very complicated situation. I feel like being a startup again is very similar. Starting a business is fraught with uncertainties. Many elements that we relied on in the past are changing now.

“Trust is important for a startup. For startups, success is the result of ideals, not calculations.

“In fact, we have already mastered numerous challenges over the past 30 years. This time the challenge we face is not the result of an internal problem. Instead, it’s outside pressure. In fact, this challenge has rekindled the passion of our more than 190,000 employees. “

Her son, who goes to a British university, told her she said, “Everything will be fine, Mom. You see, Manchester United used to have a harder time than you, but now they are a top team. “

Catherine Chen (Chen Lifang). Photo: Wikimedia

The Trump administration blacklisted Huawei over claims it would allow its access to the 5G network to spy on behalf of the Chinese state. It later changed its export control rules to block all unlicensed shipments of chips and components to the company, even from non-US suppliers, if they contained American machinery or technology. The plan was approved by the UK Select Defense Committee, which said there was clear evidence of collusion between the company and the Chinese Communist Party apparatus.

On the surface, the US strategy advocated by Joe Biden works, even if Huawei is not quite heading for the relegation zone. Sales fell by 38% compared to the previous year. The premium smartphones introduced at the end of July work neither for 5G nor with the Google Play Store. It was forced to sell part of its business to Honor, which has largely captured Huawei’s domestic market share in the cell phone business.

“Wholeheartedly” in the innocents of Meng Wanzhou

In the UK, telecommunications companies have their final deadline at the end of the month to stop installing Huawei devices on UK 5G networks. Huawei was also in a lawsuit involving Meng Wanzhou, Huawei’s chief financial officer and daughter of company founder Ren Zhengfei. She remains under house arrest in Vancouver as the US is filing for extradition for allegedly fraudulently misleading its banker HSBC into a possible violation of US sanctions against Iran.

“Meng Wanzhou has been my colleague and friend for 26 years,” said Chen. “We are both women and mothers. She has been detained in Canada for almost 1,000 days, which is really unfair to her. I can imagine how difficult this time was for her and how much influence it had on her life and work. We have full confidence in their innocence. I know you very well. We have and will always support their pursuit of justice. “

Huawei CFO Meng Wanzhou left her Vancouver home last month to attend a delivery hearing. Photo: Don Mackinnon / AFP / Getty Images

When asked if she admits a connection between the extradition case and the two Canadians arrested in China, Michael Spavor and Michael Kovrig, and the possibility of them negotiating, she ducks, as does broader human rights issues. “I’ve read media reports that these cases are related, but I don’t know what the connection is.”

However, Chen’s main message relates to the company’s viability. He insists Huawei has the resources to diversify and find new revenue streams, and points out that of the company’s 190,000 employees, more than 100,000 are in research and development.

She said, “Our R&D investment will be around $ 20 billion this year [£14.5bn]. According to a report from Europe, Huawei has been among the top spending on research and development for 10 years in a row. We are also one of the top companies when it comes to patent applications. “

However, she admitted, “We don’t currently have a solution to the advanced chip restrictions we are facing, so our revenue from this business has suffered. Chances are companies in China, Europe, or elsewhere are addressing the barriers to advanced chips. At that time, Huawei could celebrate a comeback in the smartphone business. “

In the meantime, Huawei could move forward with other products that have lower requirements for advanced chips, she said.

“To be honest, we don’t yet know the shape of future smart devices. The smart devices that we will use in the future may look very different than they are today. Although Huawei has only focused on communication technologies in the past, we now recognize that many of the technologies we have developed can be applied to industries outside of communication and add value. In addition, these technologies are developed independently by Huawei, which means that they rely very little on US technology. “

“Huawei’s exclusion does not make the US safer”

She says America identified the fake cyber threat in Huawei. “The exclusion of Huawei does not make the US safer. Cyberattacks have not decreased in the US or anywhere since Huawei was shut down. The exclusion of Huawei does not make the US stronger either. In fact, these moves have undermined the competitiveness of US companies, ”she said.

“Let me be clear: Huawei has never received requests from the Chinese government to undermine the interests of other countries or to act illegally. Never. Our founder says the same thing when interviewed in China. The Chinese government and the Chinese people understand our position on this. Mr. Ren also stated that we would never comply with such a request. We have emphasized that again and again. “

In the case of the UK, she is clear that Boris Johnson’s revised decision to ban her company from 5G was politically motivated. “Specialized cybersecurity risk management organizations in the UK, such as the Huawei Cybersecurity Evaluation Center Oversight Board, have identified areas where we can improve, such as our software quality. But it also acknowledged that Huawei is subject to the strictest control regime in the UK.

She claimed that there had been no evidence of any wrongdoing by Huawei during this entire decade of oversight.

“In the first half of 2020 they have [the UK government] made a decision based on risk management considerations, but in the second half of the year they made a decision based on political considerations. ”No credible evidence was ever presented against her company, she said.

The UK government says it “will never allow commercial national security decisions to prevail,” and while sticking to its original assessment that the risk associated with Huawei was manageable with surveillance, the US ban on the sale of its chips meant Huawei in May 2020 the risk had changed.

Chen said the UK could be the net loser in the expulsion of Huawei in the medium term. “If the UK government wants to maintain its innovation leadership, balance North and South development and excel in other areas, it should maintain open and free trade policies to attract more investment in R&D and other areas.”

As for the extent of the pushback against Huawei’s engagement in 5G across Europe, she doesn’t seem discouraged. “What we’re seeing now is pretty much what I expected. Huawei has been represented in Europe for more than 20 years. I believe our customers already know whether Huawei’s products and technologies are safe, valuable, or competitive.

“I think most countries would choose to work with Huawei if they made decisions based solely on technological considerations.”

She ends up admitting how much the pandemic shocked her by revealing our collective lack of mutual understanding. “I thought I understood different cultures, but this pandemic really made me question this because of the way different cultures have reacted. People can’t even reach consensus about wearing masks. “