News Details

( 20 Aug 2019)
Huawei expects no relief from US sanctions but is confident

The founder of Chinese tech giant Huawei said Tuesday he expects no relief from US export curbs due to the political climate in Washington but expressed confidence the company will thrive because it is developing its own technology.

Ren Zhengfei also said he doesn't want relief from US sanctions if it requires China to make concessions in a tariff war, even if that means his daughter, who is under house arrest in Canada on U.S. criminal charges, faces a longer legal struggle.

In an interview at Huawei's sprawling, leafy headquarters campus in this southern city, the 74-year-old Ren said Huawei expects U.S. curbs on most technology sales to go ahead despite Monday's announcement of a second 90-day delay. He said no one in Washington would risk standing up for the company.

The biggest impact will be on American vendors that sell chips and other components to Huawei, the biggest maker of network gear for phone companies, he said.

Washington has placed Huawei on an "entity list" of foreign companies that require official permission to buy American technology.

"Whether the 'entity list' is extended or not, that will not have a substantial impact on Huawei's business," said Ren. "We can do well without relying on American companies."

Huawei Technologies Ltd, China's first global tech brand, is at the center of a battle over trade and technology that threatens to tip the global economy into recession.

American officials accuse the company, also the No. 2 global smartphone brand, of stealing technology and facilitating Chinese spying, accusations Huawei denies.

Huawei's chief financial officer, who is also Ren's daughter, is fighting extradition from Canada to face US charges related to possible violation of trade curbs on Iran. Beijing arrested two Canadians in a possible attempt to force her release.

Ren looked relaxed and confident throughout the two-hour interview at a palatial new building in neoclassical European style where Huawei entertains customers.

The atmosphere was a striking contrast from a June 17 news conference at which Ren compared the company to a "badly damaged airplane" and warned U.S. sanctions would cut Huawei's projected smartphone sales by $30 billion over the next two years.

President Donald Trump has suggested controls on Huawei might be lifted if Beijing agrees to a deal on trade and technology disputes that led to US tariff hikes on Chinese imports.

Ren rejected that. He said Huawei couldn't ask for favors that might hurt the interests of China's poor majority.

"I couldn't take it if those poor people sacrificed their own interests for the benefit of Huawei," said Ren.

"Maybe my daughter will suffer more. But I would rather do that instead having the poorer people in China sacrifice for Huawei's survival and development."

The May announcement of export curbs prompted warnings that sales of Huawei smartphones and other products that use U.S. chips and other technology could be devastated. The curbs also mean a loss of billions of dollars in potential annual sales for American vendors.

Even before the announcement, Huawei was working on developing its own chips, software and other technology that might reduce reliance on American vendors. The company spent USD 15 billion last year on research and development, more than Apple Inc. or Microsoft Corp.

Huawei reported sales in the six months through June rose 23.2 per cent over a year earlier. Its chairman, Liang Hua, said in July that Huawei was reviewing its core products to make sure they all could be delivered to customers without American components.