Tuesday, February 27, 2024

Huawei, from fighting to saving to returning after 5 years of US sanctions

Five years ago, the US launched a legal offensive against the Chinese technology giant Huawei that would prevent it from accessing American technology and Google services, leaving the company in a “relationship fight for survival” and later declaring it “is back.”.

In January 2019, the United States accused Huawei of fraud and violating sanctions on Iran, which led weeks later to sanctions on the company for endangering national security, according to Washington.

The restrictions began to take their toll when Huawei surpassed American Apple and South Korean Samsung to become the world leader in smartphone sales in the second quarter of 2020.

Touched, but not sunk

The company, which is not listed on the stock exchange, closed 2020 with a 41% decrease in sales, fell to sixth place in global market share, and in 2021 its income suffered a year-on-year decrease of 28.5%.

In addition, in 2020, it sold its low-cost device subsidiary, Honor, to a majority state consortium to “save the industry chain” in the face of sanctions against the parent company.

However, according to the Chinese consultancy TechOcean, the sanctions “do not affect Huawei’s core business” because the phones are “just one of the legs,” one that “could have negative effects if it is a significant part of the income.” “fluctuations” in that market.

In fact, telecommunications infrastructure continues to represent the majority of Huawei’s revenue, and other “legs,” such as cloud computing, intelligent car solutions, or artificial intelligence, “continue to contribute to its growth.”

In China, where many Google services are already blocked, Huawei barely noticed the impact of the sanctions—despite experiencing a year-on-year decline in sales in 2021—and ranked second in the local smartphone market by the end of 2023. .

The iconic Mate 60 and the Android break

Last September, the launch of the Mate 60 phones generated a lot of anticipation in China as a symbol of Huawei’s recovery, something that caused some stores to run out of stock.

The Mate 60 uses a 7-nanometer chip made by China’s largest semiconductor producer, SMIC, despite restrictions from the US, whose government has announced it will investigate alleged Chinese development. in this field.

In addition, Huawei announced that its operating system, HarmonyOS Next, will no longer be compatible with Android applications, marking its break with the Google system, which has been banned from selling Chinese-brand products since 2019.

The storm is “beaten.”

Huawei’s rotating chairman, Ken Hu, recently said that the company has “weathered the storm” and is “back,” announcing in 2023 that revenue will rise 9% annually to $99 billion.

The company has thus regained optimism after several years of reduced turnover and external “challenges,” contrary to the behavior of 2020, when its priority is “sustainable.”.

“Through the work of our R&D, supply, and other teams, we have made great progress in business continuity and technology leadership,” said Hu.

Growing political profile

In 2021, Chinese media covered in detail the return to China of Meng Wanzhou, then Huawei’s chief financial officer and daughter of the company’s founder, after Canada released her as part of a deal with authorities in the US to suspend judicial proceedings for fraud against him concurrently. with the release of Canadians Michael Spavor and Michael Kovrig, detained in apparent retaliation by China since 2018 for espionage.

State broadcaster CCTV live-streamed Meng’s landing after three years of house arrest, greeted by a red carpet and a crowd waving Chinese flags, while the official People’s Daily described his return as “a victory for the Chinese people.”

Likewise, since Chinese diplomacy was reactivated in 2023 after the ‘zero COVID’ policy, visiting Huawei offices has been part of the agenda of leaders from countries such as Argentina, Brazil, or Algeria on their official trip to China.

Another exponent of this trend was recorded in September, when the president of China, Xi Jinping, gave his Venezuelan counterpart, Nicolás Maduro, a folding model of the brand, to which the Caribbean responded by praising the security of Huawei phones against American interventions.

The US and Europe remain hostile

Huawei mobile phones are banned in the US but can be found on platforms such as Amazon or eBay. Operators also received a veto order, but others, such as T-Mobile, are providing service, albeit with difficulties, according to Internet users.

Regarding telecommunications equipment, the “Rip and replace” program subsidizes the “removal and replacement” of Chinese infrastructure such as Huawei, but operators have criticized that a lack of financing has forced them to abandon rural areas without connectivity.

Due to pressure from the US, the United Kingdom banned the installation of new Huawei equipment in the 5G network in 2020 and was given until 2027 to completely eliminate it from the infrastructure.

For its part, the European Commission considers that Huawei “presents a higher risk than other suppliers” in the 5G network due to its alleged links with the Chinese Government, according to the latest 2023 report on measures made for the security of this technology, resulting in restrictions imposed by ten countries on Huawei or the Chinese ZTE that participated in the deployment of their 5G network, actions that Brussels “justified.”

The company expressed its “strong objection” and assured that the conclusions of Brussels “are not based on a transparent or objective judgment.”

Meanwhile, in Spain, the government is waiting for the publication of the list of high-risk suppliers, as stipulated in the 5G Cybersecurity Law, and whether or not it will include Huawei.

World Nation News Desk
World Nation News Deskhttps://worldnationnews.com/
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