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Huawei Chief Warns US of Tough Response to Supply Restrictions

David Paul

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Huawei Cyber Security

The company’s rotating chairman, Eric Xu, says President Trump could open a “Pandora’s Box” if the US continues to impose tough sanctions.

Tech giant Huawei’s rotating chairman, Eric Xu, has said the Chinese Government will not “sit there and watch Huawei being slaughtered” by a US embargo imposed on the company.

Xu said that 2019 was a difficult year for Huawei, but added that “2020 is going to be more difficult. It will be most difficult for Huawei.”

Speaking at a press conference in Shenzhen this week, Xu said that despite significant challenges – including the introduction of sanctions in May – the company recorded a 19.1% increase in sales to $123 billion (£100 billion).

The company also saw net profit rise to $9 billion (£7.3 billion), up 5.6% from 2018. This was, however, the slowest increase for three years. Xu attributed the sluggish performance to the US embargo put on the company last year.

Huawei was placed onto an ‘Entity List’ by the US, banning agencies in the country from buying products from Huawei and ZTS, both based in China. In the long term, Xu insisted this will have a “destructive effect” and a result in the “catastrophic destruction” of the global industry chain.

Commenting on what to expect from the years ahead, Liang Hua, chairman of the board at Huawei, commented what the future holds for the company.

“2020 may prove to be an even greater challenge,” he said. “We will need to further adapt to the long-standing restriction imposed by the Entity List, while also addressing the impact of the on-going COVID-19 pandemic.

“Nevertheless, we are fully confident in what the future holds. We will stay the course and continue creating value for our customers and the broader global community.”

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The expansion of Huawei, the world’s largest producer of telecoms equipment, is continuing to be a talking point for western countries. In the UK, concerns have been raised about the transparency of the company and its potential links to the Chinese government, with the US warning Prime Minister Boris Johnson that the company has backdoor access to global phone networks, potentially putting Britain at risk.

Johnson has granted Huawei limited kit supply to sensitive parts of the UK’s 5G network and banned access to the country’s critical infrastructures, ignoring pressure from the US to ban the company entirely to avoid potential espionage by China.

David Paul

Staff Writer, DIGIT

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