The executive said that Huawei would probably face difficult times as a number of countries are planning to ban the vendor in 5G contracts
Ren Zhengfei, founder and CEO of Chinese vendor Huawei, warned employees about potential job cuts as additional countries are looking to ban the use of the firm’s 5G equipment in core networks, international press reported.
In an email sent to employees, the executive said that the company’s outlook for the coming years “will not be as optimistic as we imagined” and urged staff to “prepare for hardships and make a correct estimate of the economic situation.”
Ren also said that unrealistic objectives needed to be adjusted and that non-productive staff will experience cuts in order to reduce labor costs.
The executive also indicated that 5G won’t be as groundbreaking as 4G, as the new technology will be mainly used in specific use cases as opposed to 4G, which was rolled out nationwide by most of the countries.
“Things went too smoothly for us in the last 30 years,” Ren said. “We were in a phase of strategic expansion, our organisation expanded in a destructive way. We have to review carefully if all geographical subsidiaries are efficient.”
A number of countries including the U.S., Canada, Japan the U.K., Germany, Australia and New Zealand have already taken certain steps to block or limit purchases of network equipment from Huawei and ZTE, over security allegations. In a recent rare press conference with international journalists, Ren said that his company does not spy for the Chinese government and that it would not respond to improper government requests for information.
“China’s ministry of foreign affairs has officially clarified that no law in China requires any company to install mandatory back doors. Huawei and me personally have never received any request from any government to provide improper information,” Ren added.
In related news, Canadian authorities have confirmed that the U.S will soon make a formal request for the extradition of Huawei’s CFO, CNN reported.
“I have been told the U.S. Justice Department will proceed,” David MacNaughton, Canada’s Ambassador to the United States, told CNN. “We have had no indication that they will not.”
In December, Huawei CFO Meng Wanzhou — who is the daughter of Huawei’s founder Ren Zhengfei — was arrested in Canada for extradition to the United States, in relation to an investigation of whether the company violated U.S. sanctions against Iran.
China subsequently detained two Canadian citizens: businessman Michael Spavor, and Michael Kovrig, a Canadian diplomat on leave to work for a non-governmental organization based in China.
China’s Ministry of Foreign Affairs also reiterated its request for Meng to be released, claiming the U.S. and Canada had abused their extradition treaty. Ministry spokeswoman Hua Chunying said Canada “made a serious mistake at the beginning [of the process]” and Meng’s case is not a “regular judicial case.”
“We also urge the U.S. to correct their mistakes and withdraw the arrest warrant for Meng Wanzhou,” Hua said.
In December, U.S. President Donald Trump had said he could intervene in the case of Huawei CFO if it helps to avoid a further deterioration in U.S. relations with China. Trump said at the time that he would intervene in the U.S. Justice Department’s case against Meng if it would serve national security interests or help achieve a trade deal with China.
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