Huawei’s Ren Zhengfei calls for more open US policy towards China under Biden

The Huawei founder and CEO speaks out on the US-China tech war for the first time since US President Joe Biden took office
The comments come as the Chinese telecoms giant explores new business areas such as cloud services and smart cars to weather the storm

Joe Biden’s China policy

Celia Chenin Taiyuan

Published: 1:36pm, 9 Feb 2021

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Huawei Technologies is urging the administration of US President Joe Biden to establish a more open policy towards Chinese companies, said founder and chief executive Ren Zhengfei at a roundtable meeting on Tuesday with select media in Taiyuan, capital of the northern Chinese coal hub of Shanxi, on Tuesday.

The world’s largest telecommunications equipment supplier and the bestselling smartphone maker in China hopes to avoid being dragged down by geopolitics, said Ren, 76, in his first public interview since Biden took office last month.

“Our company does not have the energy to be involved in this political whirlpool. We strive to make good products,” he said. “We hope that the US government can have a more open policy for the benefit of American companies and the development of the US economy.”

Ren questioned whether Washington’s sanctions against Huawei benefit US interests, indicating that Britain’s pressure over its American colony in the 18th century spurred the rise of the United States.

“Will the US blockade today lead to unexpected consequences?” he asked.

Despite Ren Zhengfei’s apparent confidence, Huawei has embarked on a range of initiatives in a bid to reinvent its hampered business. Photo: Handout

Under the Trump administration, Huawei was slapped with US restrictions that blocked its access to tech hardware, software and services of US origin. Some US lawmakers have urged the Biden administration to retain these sanctions against Huawei. Last week, Biden’s nominee for Commerce Secretary, Gina Raimondo, said she saw “no reason” why the Chinese company and its peers should not remain on the US entity list.

Ren said he thinks it would be “extremely difficult to remove Huawei from the entity list.”

“I will not say it is impossible, but it is extremely difficult, so basically, we do not have that expectation,” he said. “We just want to work hard, and we have plenty of money and can hire a lot of scientists.”

Ren reiterated his previous offer to share Huawei’s 5G technology with US companies.

“We have said before that our 5G technology can be transferred in its entirety. That includes not only the rights to development but also source programs and source codes. If the US needs our chip technology, we can transfer it. Our words are sincere [but] no company has come to negotiate with us so far,” he said.

Still, Ren said Huawei “will never sell its [entire] consumer business,” which includes smartphones.

Huawei’s sale of premium smartphone brands would be ‘a last resort’

Boycotts by the US and its allies have excluded Huawei from lucrative 5G mobile network equipment supply contracts. And without access to sophisticated chips and Google services, Huawei saw its ranking among global smartphone sellers fall from second to the fifth place in the second half of last year.

Ren said the deployment of 5G in China and other markets around the world helps underscore the value Huawei brings to the telecoms industry.

“My confidence grows in Huawei’s ability to survive ... We have great confidence in our customers,” he CEO said, adding that his company’s 5G offerings have an edge in both industrial applications, such as in coal mines and seaports, as well as in consumer products, such as tablets and smart televisions.

Ren also praised Huawei’s smartphone rival Apple, calling the iPhone 12 “the world’s best smartphone.”

“High-end customers in Europe love Apple,” he said. “Since [Huawei] doesn’t have premium handsets any more, Apple’s phones have helped us prove that Huawei’s 5G technology is the best.”

Apple fan (and Huawei CEO) Ren Zhengfei pictured with an iPad

Despite Ren’s show of confidence, Huawei has embarked on a range of initiatives in a bid to reinvent its hampered business.

In November, the Shenzhen-based giant sold its budget smartphone brand Honor to a consortium of Chinese entities – a move that allowed the smaller brand to resume partnerships with Microsoft, Intel, Qualcomm and a number of other international suppliers.

Huawei has also pushed into new growth areas such as smart vehicles, while doubling down on existing businesses such as cloud services. As part of the business transformation, the company recently put its consumer business head Richard Yu Chengdong in charge of smart vehicles, cloud services, as well as artificial intelligence (AI).

“We think our new business development can offset the decrease in revenue in our smartphone business this year,” said Ren.

Apart from the US sanctions issue, Huawei’s chief financial officer Meng Wanzhou is still in Canada fighting a prolonged US extradition request. The eldest daughter of Ren, Meng has been held in Vancouver since December 1, 2018, when she was arrested at the city’s airport by Canadian police acting on a US warrant. She is wanted in the US on fraud charges, which she denies.

“The case of Meng Wanzhou is a political manoeuvre operated by the US. There are some issues with how Canada implements that,” said Ren. “We still believe in Canada’s legal procedures.”

Meng Wanzhou has been held in Vancouver since December 1, 2018. Photo: AFP

For years, Ren and his family had sought to keep a low profile, despite their wealth and the growing success of the company he founded. The billionaire told the South China Morning Post last year that his “biggest wish is to drink coffee in a cafe unnoticed.” China’s increased tensions with the US, however, have thrust Ren into the spotlight and forced the company leader to become more outspoken.

For now, retirement does not seem to be on Ren’s mind.

“It’s not a question of when I should retire but what I can do after retirement,” he said. “My wife said I can drink tea in the morning [but] I also drink tea in the afternoon, so I won’t be able to sleep at night. I don’t have a lot of interests and hobbies.”

Huawei’s revenue in 2020 reached a record US$136.7 billion, reported Chinese business news outlet Yicai on Monday, citing unaudited internal figures. While the telecoms giant’s annual profit rose more than 10 per cent to US$9.9 billion, its year-on-year growth rate dropped to around 11 per cent.

This marks the second straight year that Huawei’s revenue growth has slowed. Its annual growth rates in 2018 and 2019 were 19.5 per cent and 19.1 per cent.

Huawei declined to comment on the reported figures and said it will release official annual numbers in March.

Additional reporting by Masha Borak

This article appeared in the South China Morning Post print edition as: Huawei calls for a more open US policy