US ban will not lead to Huawei’s negative growth: Founder CEO

By Digit NewsDesk | Updated May 25 2019
US ban will not lead to Huawei’s negative growth: Founder CEO
HIGHLIGHTS

​Huawei Founder CEO says US ban won’t affect company much.

He said, the company was prepared for “something like this.”

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An executive order by the Trump Administration has imposed mandate on US companies to cut trade relations Huawei. Media reports have suggested that this could affect the company dearly, however, a top company executive has painted positive picture claiming that Huawei’s growth will slow down, though not by as much as everyone imagines.” He also said that the US companies and Huawei are sharing the same fate.

“In the first quarter of this year, our revenue grew 39 percent over the same period last year. This rate decreased to 25 percent in April, and may continue decreasing towards the end of this year. But the US ban will not lead to negative growth or harm the development of our industry,” Ren Zhengfie, Founder CEO , Huawei Technologies Co. Ltd, has said. “US companies must abide by the laws, and so must the real economy. So let’s not blame them. The blame should rest with some US politicians. We should understand that these US companies and Huawei share the same fate. We are both players in the market economy,” he added.

Out of the top three smartphone vendors, it was only Huawei that registered an increase in the global market share as well as smartphone shipments in the first quarter of 2019. It’s competitors, Samsung and Apple, registered a decline in shares. Huawei’s share in the global smartphone market reached its highest ever level of 17 percent in the quarter. It leapfrogged Apple as the second largest selling smartphone brand in the quarter as its volumes increased by nearly 50 percent year-over-year.

When sought a clarification on a comment that said, “Huawei does not need chips from the US. There is no problem with Huawei,” the executive said that the company is always in the need of chips, and their US partners are seeking for approval from Washington. The company also plans to sell chips to US companies to help the US make more advanced products. “We want to have partners all over the world. We don't want to hurt our partners. We want to help them have robust financial statements, even if it means we have to make adjustments,” Ren added.

On the claims of having stockpile of electronics components, Ren said that Huawei will not end up with an extreme supply shortage as they were well prepared. “At the beginning of this year, I predicted that something like this would occur two years later, and that the US would not take action before the US lawsuit against us was settled in court. We were quite sure that they would take action against us whatever the result was. We thought we would have two years to make preparations. But when Meng Wanzhou was arrested, it sparked everything off,” he added.

For those who don’t know, Huawei CFO Meng Wanzhou was arrested on December 1 in Vancouver by Canadian authorities for alleged Iran sanction violations. US prosecutors have charged Meng with covering up Huawei's links to a company called Skycom that sold over $100 million worth of technology equipment to Iran. Meng Wanzhou, 47, is the daughter of Ren Zhengfei.

Meanwhile, Ken Hu, Deputy Chairman, Huawei, dubbed US ban unjustified. “In recent days, restrictions, based on ungrounded allegations, have been imposed on Huawei in order to disrupt our business operations. We believe this behavior is totally unjustified,” Ken said while speaking at the Potsdam Conference on National Cybersecurity, in Germany. In Europe, approximately three-quarters of smartphone users rely on an Android-based phone, the company said, adding that Huawei accounts roughly for 20 percent of this market.

“Such reckless decisions can cause a great deal of harm to consumers and businesses in Europe. This sets a dangerous precedent. It goes against the values of the international business community, cuts off the global supply chain and disrupts fair competition in the market. This could happen to any other industry and company in the future if we don't jointly confront these issues,” the executive added.

Recently, UK-based chip-maker ARM reportedly told its employees to not “provide support, delivery technology (whether software, code, or other updates), engage in technical discussions, or otherwise discuss technical matters with Huawei and HiSilicon (a chipmaker Huawei owns)” anymore. Telecom giants like EE and Vodafone also dropped Huawei devices from the launch of their respective 5G networks. On this, the executive said Huawei doesn't want any “painful experience.”

“When I arrived [at the University of Potsdam] earlier, I was told that we are at a historic site where the Berlin Wall once stood. This reminded me of the fact that we don't want to see another wall and we don't want to go through another painful experience. Equally, we don't want to build a new wall in terms of trade, we don't want to build a new wall in terms of technology either. We need an integrated global ecosystem which can help us to promote faster technological innovation and stronger economic growth. Ultimately, it is what we have to rely on in order to maintain prosperity for human society,” he said.

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