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News | Business | Tech: Huawei hopes Biden presidency brings a 'reset' to relations, says tech officer

 


Sumathi Bala


Huawei hopes to “reset” relations with the United States under Joe Biden’s presidential administration, according to a senior executive at the telecom equipment and mobile phone giant. 

Paul Scanlan, chief technology officer at Huawei Carrier Business Group, told CNBC’s Arjun Kharpal that when there “is a change in government, there is always the opportunity to reset relationships. The unit of Huawei focuses on deploying 5G networks.

The Trump administration announced sanctions against China’s Huawei in August that effectively cut off the company from some technology it got from the United States. The measures added to a slew of actions the U.S. has taken in the past 15 months against Huawei, which it has accused of being a national security risk. Huawei refutes that allegation.

“Of, course under the previous administration, we had a lot of challenges,” Scanlan said in apparent reference to the Trump White House. Huawei has been “working through those challenges” with customers and suppliers, said Scanlan, who spoke to CNBC as part of the annual East Tech West conference.

Despite those problems, Huawei remains “optimistic” the two sides can resolve their differences. “We would welcome more dialogue,” said Scanlan, who added that “with dialogue comes understanding, then comes trust, and then people can do business together.”

Margin pressure

U.S. sanctions have put pressure on the company’s margins. For the first nine months of the year, revenue totaled 671.3 billion yuan ($98.57 billion), up 9.9% from the 610.8 billion yuan reported in the same period last year. That’s a significant slowdown in growth — in the first nine months of 2019, Huawei’s revenue grew by 24.4%.

Meanwhile, Huawei’s net profit margin came in at 8% for the first nine months of the year, down from 8.7% in the same period last year.

Like the United States, a number of countries including the U.K. and Australia have banned Huawei from their 5G networks on security grounds. France, meanwhile, has said that it prefers European vendors but has not gone as far as an explicit ban on Huawei. Sweden banned Huawei from its 5G networks, though an appeal by the Chinese firm has overturned part of that decision.

Japan has effectively banned Huawei from its 5G network after the government prohibited public procurement of the company’s equipment through new rules announced in 2018. However, it has not mentioned the company by name. Japan’s major carriers are not using Huawei gear for 5G.

Scanlan sought to downplay “trust” issues countries may have about Huawei gear, insisting the company has been open in its dealings with governments globally.

Scanlan underlined if a government wants to inspect the products, then we show the products, we show everything that’s inside the products.”

“They can bring their experts to us or us to them, and we can sit down and demonstrate that the product is trustworthy,” he said.

“We do that across the world,” he said.

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