China carries out its largest industrial policy with Huawei

Share This Post

- Advertisement -


- Advertisement -

George Castro

International analyst

- Advertisement -

Four years ago, Huawei, China’s largest high-tech equipment maker and the world leader in 5-G mobile Internet, was wiped out by the US government by every possible use of any innovation coming from American high-tech companiesprimarily with regard to the design and manufacture of semiconductors or “chips”, which form the core of the digitalisation process of the global economy.

Washington considers Huawei the greatest security risk of the United States in the decisive field of high technology, and avant-garde expression of the challenge launched by the People’s Republic, which dared to contest the dominance of the crucial technologies of the Fourth Industrial Revolution (CRI): artificial intelligence, the Internet of Things and robotization.

He The impact US sanctions have had on Huawei has been brutal: Its net earnings were $130 billion in 2019, plummeting to $32 billion in 2022, with revenue dropping from $830 billion to $600 billion over that period.

The US blow to Chinese society was overwhelming and forced it to cease production of 5-G smartphones; and this happened at a time when it was competing for first place in the world with Apple, the American company founded by Steve Jobs.

Now, 4 years later, Huawei stands by it the business tends to “normalize” due to its expansion into the Chinese marketwhich has the largest number of Internet users of the global system, with 1,100 million “smartphone” (smartphone) owners, out of a population of 1,440 million inhabitants which is the second in the world after India.

The key for Huawei in its survival strategy does not lie in its phenomenal growth in the market of the People’s Republic, which it considers an essentially quantitative and therefore marginal value, but in the fact that it has managed to systematically supplant the later technologies that have been denied it by Washington.

The latest of these innovations is the so-called ERP (Enterprise Resource Planning System), which is at the basis of the digitization process of production and services, and therefore the main tool for the full deployment of CRI, above all through the channeling of artificial intelligence , the main technology of the time.

This task of supplanting US bans is what Huawei he values ​​a qualitative effort, creator of successive breakthroughs; on the road that leads no longer to recovering its global role in 5-G, but on the higher step, namely that of 6-G, which is none other than the complete and automated connection of all individuals with all things.

Here because Huawei systematically rejects the status quoeven if it dominates it, in the certainty that its mere defense is the surest way to defeat.

In short, what matters for the Chinese company is not to dominate a certain space, even if it is the internal market of the People’s Republic, but allies with the futureuniting the instantaneous, which leads her to hate the merely quantitative.

For this specific task, Huawei received preferential credits from the Chinese government for US$948,000 million in 2022, double the previous year.

AND an exercise in industrial policy the one carried forward by the People’s Republic starting from the assumption that the essential thing is not the control of a market, but the mastery of cutting-edge knowledge (manifested in international patents); and all this is done on the assumption that the world is in the current historical phase absolutely unified by the revolution of technology; and in it what predominates are not weapons, nor population, nor GDP, but the advanced knowledge of the 21st century.

This industrial policy of Beijing which has Huawei as an active subject is certainly a bet in the Pascalian sense it brings together an act of reasoning about its innovative strength and a profession of faith.

For its part, Huawei invests more in research and development (R&D) than the PRC’s top 3 digital platforms – Alibaba, Baidu and Tencent – combined ($17,008 million in 2022).

It should be added that China’s domestic market for digital transformation products of manufacturing and services amounted to $2.38 trillion in 2022; and Huawei is the company driving this formidable mutation.

All resources granted by the Chinese government are conditional on results; and it is clear that the criterion used by the Beijing system to favor Huawei was indicated by the US initiative to exclude the Shenzhen company, which is an unequivocal judgment pertaining to the Washington government.

“Learn from your enemies and respect their opinions, even the wrong ones”; This is a classic rule of Chinese strategy emerged from its 5,000 years of history and survival.

Source: Clarin

- Advertisement -

Related Posts