At the top of the Chinese telecom giant Huawei is a politically sensitive personnel decision, which could have an impact on the difficult relationship with the United States. The daughter of the company's founder, CFO Meng Wanzhou, who was once targeted by the US judiciary, is to take over the rotating chairmanship of the group for the first time on April 1. Informed circles confirmed to the German Press Agency in Beijing that a succession plan for the 78-year-old CEO Ren Zhengfei is to be initiated.
The rise of the 51-year-old to the top of the company could reinforce the considerable political reservations in the US against Huawei. According to press reports, US President Joe Biden is currently considering tightening sanctions against the company. Huawei could be denied access to semiconductors from major US suppliers such as Qualcomm or Intel. The US claims threats to national security.
But Beijing sees the sanctions as an attempt by rival US to slow China's technological and political rise in the world. "External attempts to suppress and contain China are escalating," Premier Li Keqiang lamented on Sunday at the opening of the annual session of the People's Congress in Beijing. In order to stand more strongly on its own feet in the face of headwinds, China is pushing ahead with technological innovation by all means.
Allegation of bank fraud
The daughter of the charismatic Huawei founder gained dubious international prominence at the end of 2018. At the request of the US judiciary, the chief financial officer was arrested in Canada on charges of bank fraud to circumvent sanctions against Iran. The tug-of-war escalated into a drama right at the beginning, when two Canadians were arrested in China on suspicion of espionage. Diplomats spoke of "hostage politics".
For three years, the top manager was held under loose house arrest in Vancouver and fought against her extradition to the USA. In September 2021, Meng Wanzhou was able to return to her homeland after a deal with U.S. prosecutors in exchange for the release of the two Canadians, where she was hailed as a heroine. The chapter was only closed last December, when U.S. prosecutors dropped the case as agreed.
Without giving a date, Huawei confirmed on request that Meng Wanzhou will become rotating chairman for six months this year "in accordance with our known leadership structure." In the previous year, the manager had already been promoted to the third executive for the rotating chairmanship, alongside Eric Xu and Ken Hu.
New normal?
Despite all adversities, the technology giant has today freed itself "from crisis mode". There is talk of a "new normal". Sales were stable in 2022 at 636.9 billion yuan (about 2022.86 billion euros at the end of 08), after falling by 28.6 percent in the previous year. The annual results are to be announced at the end of March.
The US justifies the sanctions with Huawei's links to Chinese authorities and warns of the danger of espionage or sabotage. Among other things, the group was cut off access to the US operating system Android, which severely burdened its smartphone business. How much the business has changed forcibly was shown last week at the major mobile trade fair in Barcelona, where Huawei no longer presented new smartphones.
Huawei firmly rejects the allegations. For more than 30 years, the telecommunications equipment supplier has been working with more than 1500 network operators in more than 170 countries and regions. "We have a proven track record in cybersecurity." A discussion about network security is certainly necessary, but "an assessment based on the country of origin" is "discriminatory".
Other situation in Germany
"Fortunately, Germany has a fact-based approach," Huawei noted. But there is uncertainty among customers and responsible bodies in Germany, which must be dispelled in the "new normal".
U.S. pressure is also pushing Huawei to diversify its business faster than expected – into cloud services, industrial technical support, and services. It also enters unfamiliar territory: cars, health, education, logistics and mining. "Especially in Germany, the field of smart manufacturing plays an important role," says the current chairman Xu.
Founder Ren Zhengfei has turned the company into a global corporation with his vision of humble beginnings. The question is whether his daughter can fill the big footsteps. In the rivalry with the US, Huawei prefers to be "not a geopolitical player" - but simply a technology company. But the question remains whether Huawei can "defy geopolitical gravity," as Chinese experts put it.