Chinese vendor Huawei announced its investments in research and development activities focused on its own technology will reach $20 billion this year, up compared to $15 billion in 2019, South China Morning Post reported Huawei’s CEO Ren Zhengfei as saying.
“The U.S. will continue to increase sanctions on us, and we will have to complete [the new technologies] before that happens,” Ren said.
In May 2019, the U.S. Department of Commerce added Huawei to its Entity List, a decision that effectively banned the company from buying parts and components from U.S. companies without U.S. government approval. Under the order, Huawei will need a U.S. government license to buy components from U.S. suppliers.
“It’s not a problem for us to survive as a company, but it’s questionable whether we can keep our leading position,” Ren said. “We won’t be able to lead the world in the next three to five years if we cannot develop our own technology.”
“Over 20,000 scientists, experts and engineers worked overtime during the [Chinese] Lunar New Year holiday, because we’re racing to develop new [technologies],” Ren said.
Ren also highlighted that U.S firms would also need Huawei as a client to survive.
The executive also said that the COVID-19 pandemic, which started in the Chinese city of Wuhan in December 2019 and that has now spread to many countries around the world, would not have a big impact for Huawei.
“Neither the U.S. sanctions nor the pandemic had a major impact on us,” Ren said. “We believe the impact is minimal, and we can pull through it.”
Huawei has already resumed more than 90% of its production and development operations, Ren said, adding that the company has also kept its supply chain mostly intact by helping provide its partners with protective gear to keep production going, according to the report.
Huawei is still allowed to do some business with U.S. firms, as the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce (DoC) recently announced that it had extended the Temporary General License (TGL) for Huawei and its non-U.S. affiliates which are subject to the Entity List, until May 15.
The TGL authorizes U.S. companies to make specific, limited engagements in transactions involving the export, reexport, and transfer of items to the Chinese vendor. The initial TGL was granted in May 19, 2019 and had been extended several times since then.
However, this general license does not cover transactions between U.S. semiconductor manufacturers such as Qualcomm, Intel and Micron and Huawei. These companies are required to apply for special permits in order to continue supplying chips to the Chinese vendor.
President Donald Trump earlier this month signed legislation to bar U.S. telecoms operators from using government subsidies to purchase network equipment or services from Huawei.