China’s telecoms equipment and smartphone maker Huawei expects a drastic decline of $30 Billion in its revenue over the next two years. This would be as a result of the US ban and trade restrictions on the Chinese company.
Huawei’s CEO and founder Ren Zhengfei, during a panel discussion at the company’s Shenzhen headquarters on monday, said productions will slow down, smartphone shipment will drop 40%, which would cause Huawei’s revenue to hover around $100 billion in a couple years.
“We didn’t expect the U.S. to attack Huawei with such intense and determined effort. We are not only banned from providing targeted components but also from joining a lot of international organizations, collaborating with many universities, using anything with American components or even connecting to networks that use American parts,” said Ren at the panel.
However, Ren assured that Huawei’s output will bounce back better by the year 2021 after a period of adjustment. “We are like a damaged plane that protected only its heart and fuel tank but not its appendages. Huawei will get tested by the adjustment period and through time. We will grow stronger as we make this step.” He said.
Afterall, in a response to the US action against it, the Chinese behemoth recently announced it has been preparing for years its own backup chips and an alternative smartphone operating system.
Speaking alongside Ren were George Gilder, an American writer and speaker on technology, and Nicholas Negroponte, co-founder of the MIT Media Lab who also made their contributions on Huawei’s current situation.
“It’s the U.S. that will suffer from any effort to decouple,” argued Gilder. “I believe that we have a wonderful entrepreneurial energy, wonderful creativity and wonderful technology, but it’s always thrived with collaboration with other countries.”
“The U.S. is making a terrible mistake, first of all, picking on a company,” snapped Negroponte. “I come from a world where the interest isn’t so much about the trade, commerce or stock. We value knowledge and we want to build on the people before us. The only way this works is that people are open at the beginning… It’s not a competitive world in the early stages of science. [The world] benefits from collaboration.”
While Ren said he’s optimistic about the future. “The west was the first to bring up the concept of economic globalization. It’s the right move. But there will be big waves rising from the process, and we must handle them with correct rather than radical measures.”