Huawei, the tech giant at the center of the U.S.-China trade war, has been under suspicion for its ties to the Chinese government and concerns that its telecom equipment can be used to spy.
Below is a translated transcript of the conversation, which has been condensed and edited for clarity.Akiko Fujita, Yahoo Finance: Let's talk about what played out between the U.S. and China a few weeks ago at the G20 summit, where President Trump and President Xi met. One of the points of discussion between them was to allow for some licenses so American suppliers could begin selling to Huawei again.
Story continuesRen: I don’t know what the national security concern is to the U.S. We don't have any networks in the U.S., nor do we intend to sell our 5G products there anyway, so there's no way we can pose a threat to the U.S. I think the U.S. is too apprehensive. At the end of the day, collaborating for shared success is the only way forward. The U.S. is the most powerful and the most technologically capable nation in the world.
Ren: If U.S. companies were to stop supplying us altogether, our production would not stop for a single day in the future. Rather, we would ramp up production. But we will face some difficulties because we need to switch product versions. To do that, we need more staff. This year, we have recruited over 6,000 new employees thus far to optimize or replace existing versions.
When others stop supplying us, we will use more of our own components. When others resume their supply, we will reduce our production a bit. We maintain some supply flexibility, and we will never take the path of self-reliance or isolating ourselves from others. That would never happen. People in U.S. industry and academia know more about us than these politicians. Politicians should listen more to these people, so that they may change their misperceptions of us.
The Motorola case was triggered by a box with the Motorola logo. Although it was a settlement, they lost and case and paid us legal costs in Hong Kong. How could you say it’s our problem? Akiko Fujita, Yahoo Finance: And this is my last point on this, but the accusation is not based on where you are right now, which is the leader in 5G, yes, but that you got here by stealing from American companies.
Akiko Fujita, Yahoo Finance: There are reports that have come out over the last few days that suggest you are planning significant layoffs over Futurewei R&D in the U.S. What is the future of Huawei's presence in the U.S.? Ren: Yes. This is all because we cannot engage with Futurewei employees. If we cannot even discuss their work arrangements, how can they do their work?
I've never considered trying to convince the U.S. of who I am and will not in the future. I don't care what they think about me. What matters is that we’re better than you in the win markets. No one can rely on others to fight their battles and win markets. I don't believe in any gods. I believe that we can only rely on ourselves, not anyone else.
Akiko Fujita, Yahoo Finance: Huawei is part of the trade conversation. Whether you like it or not, President Trump has made it a part of that. Since the G20 summit, there has been a back and forth, with the reports suggesting that the Chinese government is really pushing the U.S. to reduce its pressure, back off on your company as part of the concessions from the U.S. side.
Second, if we got involved, the Chinese government would have to make concessions for us. Why should China make concessions for Huawei? If they can beat the U.S., why does the Chinese government have to make concessions? If you don't want to give in, you don't give in. How does China fighting with the United State has anything to do with me ? Some people comment that the Chinese government could trade off something for Huawei.
Ren: First of all, I'd like to say a few words about our in-house OS Hongmeng. This operating system is developed to adapt to future scenarios like the Internet of Things, artificial intelligence, industrial control, and autonomous driving. The latency of this system is no more than 5 milliseconds and sometimes even less than one millisecond.
Akiko Fujita, Yahoo Finance: What about your 5G ambitions? Do you have to change the expectation a bit as a result of these very headwinds that you've talked about? Akiko Fujita, Yahoo Finance: I want to ask you about something that I think is quite personal for you, which is your daughter, arrested back in December. You are a father. You've seen your daughter going through this legal ordeal for several months now. She's in Canada. 24-hour surveillance and ankle bracelet.
Akiko Fujita, Yahoo Finance: I want to go back a bit from talking about Huawei to what has been playing out in China. Over the last several years, we have seen big growth in tech here in China. You know all the big names, Alibaba, Baidu, obviously Huawei in the mix. Despite that success, though, there are all those skeptics who say that those companies grew because they had no competition, and that Western companies could not operate here without a joint venture in place.
Akiko Fujita, Yahoo Finance: Yesterday, we had a chance to walk around the campus and talk to some of your employees, and one of the conversations really struck me because there was a researcher who said,"Look, I came to Huawei because it is committed to cutting-edge technology, but I worry that the technology that I'm developing here could be misconstrued as a national security concern", that essentially, he feels the weight of the pressure that's coming from the U.S.
Ren: The Entity List has injected a sense of crisis in our employees, and inspired passion across the company. This has provided an opportunity for us to reposition underperforming managers and replace them with outstanding young employees. This has helped increase our vitality. In this sense, the Entity List is not a negative, but a positive. It has motivated our team.
Akiko Fujita, Yahoo Finance: Given the environment that we're in right now, I've heard a lot of people refer to this as a new Cold War, saying that there's a digital iron curtain going up as a result of what the U.S. has done moving forward on pressuring the Chinese in trying to sort of constrain the technology. Is that where we're headed right now?