• About Us
  • Careers
  • Brand Partnerships
TFI Official Merchandise
TFI English
TFI हिन्दी
Saturday, September 30, 2023
TFIGlobal
TFIGlobal
Right Arm. Round the World. FAST.
No Result
View All Result
  • Premium
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean
  • Premium
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean
TFIGlobal
TFIGlobal
No Result
View All Result

Huawei and China’s Gambler’s dilemma – Can’t let it go down, saving it is costly and with huge risks

Big headache for Xi

Akshay Narang by Akshay Narang
October 24, 2020
in Indo-Pacific
Reading Time: 4 mins read
0
huawei china ccp
195
VIEWS
Share on FacebookShare on Twitter

Huawei’s fortunes have hit a major roadblock following the Trump administration’s merciless crackdown on the Chinese smartphone maker. But the Chinese Communist Party (CCP) cannot let Huawei come down so easily. Therefore, Beijing seems to be going against the tide to somehow save the telecom giant. 

However, it seems that Huawei is becoming too big a gamble for China. By saving it, China is virtually trying to save what is bound to become a non-performing asset in the near future. Yet, the CCP is making all efforts to save Huawei because it cannot allow the smartphone maker to go down in face of American pressure. 

Also Read

Jamaica’s one Trillion Dollar Budget: Is Holness Planning to Colonize Mars?

St. Lucia to become the Taiwan of the West

In fact, the company has reportedly recorded 3.7 per cent growth in quarterly revenue on Friday. The growth is being rightly described as meagre in comparison to the double-digit growth that the Chinese telecom major enjoyed earlier. 

Huawei’s growth rate has got dragged down owing to the demand and supply bottlenecks that it is facing in several countries led by the United States of America. The Trump administration has been running a campaign against Huawei’s global 5G ambitions for more than a year now. 

The United States and several other democratic countries have even shunned Huawei’s 5G technology over security and espionage concerns. Anyhow, this year the Trump administration went a step further and banned Huawei from using semiconductors based on secret American designs which is the dominant model used in the market.

While countries pushing Huawei out of their 5G markets was only hurting the Chinese telecom giant’s 5G ambitions, the semiconductor ban is turning out to be much more harmful. A tech company cannot survive without semiconductors, as they are used in every kind of tech equipment from smartphones to satellites. 

As per a report by famous analyst Ming-Chi Kuo, the effect of the semiconductor ban is that Huawei, which was competing for global domination two years ago, is now considering an exit from the market. 

And then, Google has also prohibited Huawei and Honor phones from using Google apps and services. So, Huawei phones will neither have efficient American semiconductors nor Google’s apps and services. As such, the company has lost the cutting edge in both the smartphones sector and the 5G network sector. 

Huawei itself sounds somewhat cynical. The company said, “As the world grapples with Covid-19, Huawei’s global supply chain was put under intense pressure and its production and operations saw increasing difficulties.” However, the smartphone-maker vowed to “do its best to find solutions, to survive and forge ahead”.

Huawei’s overseas sales have, in fact, remained sluggish. But then how has it remained afloat and also managed to grow marginally? The answer lies in Huawei’s domestic Chinese sales. According to Reuters, customers have rushed to purchase Huawei smartphones due to concerns about the availability of newer models. 

So, while the US has pushed the company against the wall, so much so, that even the survival of Chinese smartphone giant is admittedly at stake, the CCP has tried to use domestic sales to keep it afloat.  

The Xi Jinping regime is fuelling artificial domestic demand for Huawei, in order to somehow keep it alive. At the end of the day, it is China’s largest private company and a prized jewel. For the Chinese President, saving Huawei is not a matter of economics, but a subject of prestige. And therefore, heavy domestic demand is being created for Huawei. 

But does it make any commercial sense for the Chinese Communist Party to pump hordes of money into Huawei? The Chinese telecom giant continues to face an uncertain future, as the Trump administration shows no signs of easing the mounting pressure on the Chinese company. 

The Xi Jinping administration is clearly creating a White Elephant for itself by trying to keep the company afloat. Financing Huawei’s survival is not going to be easy for the Chinese Communist Party. The telecom major is absolutely humongous and had registered a revenue of US $123 billion last year. Now, the CCP will have to arrange a sizeable portion of the billions of dollars required to keep the company afloat. 

Saving Huawei is a gamble fraught with risks and the CCP’s efforts to ensure the telecom giant’s survival is thus going to cost China heavily. 

Tags: Short takes
ShareTweetSend
Previous Post

The India-China flip-flops of Sri Lanka are bound to end soon as US makes an entry after years of silence

Next Post

Oli’s Vijayadashami greetings has a tiny Nepal Map which doesn’t include Kalapani and Lipulekh

Also Read

India puts Ukraine in its place and the West stairs on helplessly

India puts Ukraine in its place and the West stairs on helplessly

August 29, 2023
Philippine politics just got interesting with Duterte’s crazy comeback

Philippine politics just got interesting with Duterte’s crazy comeback

July 20, 2023
Macron’s Sweet Revenge Plan in Indo-Pacific Leaves Biden Dumbstruck

Macron’s Sweet Revenge Plan in Indo-Pacific Leaves Biden Dumbstruck

July 13, 2023
Japan’s tongue-in-cheek revelation of its growing defense industry

Japan’s tongue-in-cheek revelation of its growing defense industry

June 16, 2023
Load More

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms of use and Privacy Policy.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

  • Trending
  • Comments
  • Latest
The Drug Bust of Justin Trudeau in India which Ottawa is probably hiding

The Drug Bust of Justin Trudeau in India which Ottawa is probably hiding

September 15, 2023
‘17,000 Troops Gone, 10,000 concedes’ Ukraine’s Surrender Stats Revealed

‘17,000 Troops Gone, 10,000 concedes’ Ukraine’s Surrender Stats Revealed

September 28, 2023
3 possible reasons why Sophie dumped Justin

3 possible reasons why Sophie dumped Justin

August 3, 2023
Russia’s Lithium Jackpot is set to shake up the EV World

Russia’s Lithium Jackpot is set to shake up the EV World

September 25, 2023
Drugs for Sexual Pleasure? Trudeau launches his most Abhorrent Scheme

Drugs for Sexual Pleasure? Trudeau launches his most Abhorrent Scheme

July 11, 2023
Zelensky’s Henchmen Blames NATO as Counteroffensive Fizzles Out

Zelensky’s Henchmen Blames NATO as Counteroffensive Fizzles Out

September 29, 2023
Trudeau’s Worldwide Shame Continues as Even CBC Refuses to Defend Him!

Trudeau’s Worldwide Shame Continues as Even CBC Refuses to Defend Him!

September 29, 2023
Kosovo is on a mission to drag Serbia into a NATO-Serbia War

Kosovo is on a mission to drag Serbia into a NATO-Serbia War

September 29, 2023
Trudeau’s Nazi Tribute is Set to Put Him in More Troubles

Trudeau’s Nazi Tribute is Set to Put Him in More Troubles

September 29, 2023
A Desperate NATO opts for Election Meddling as Putin’s Pal is set to Lead Slovakia

A Desperate NATO opts for Election Meddling as Putin’s Pal is set to Lead Slovakia

September 29, 2023
Youtube Twitter Facebook
TFIGlobal
  • About us
  • Contact Us
  • Terms of use
  • Privacy Policy

©2023 - TFI MEDIA PRIVATE LIMITED

No Result
View All Result
  • Premium
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean

©2023 - TFI MEDIA PRIVATE LIMITED

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

Follow us on Twitter

and never miss an insightful take by the TFIGlobal team

Follow @tfiglobal
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. View our Privacy and Cookie Policy.