The economic troubles inside China now lay bare as the founder of the country’s tech giant Huawei has warned of a ‘painful’ next decade and forecasted that China would suffer through tough market conditions.
In a memo to staff earlier this week, the founder and CEO of the Chinese company, Ren Zhengfei, sent out a blunt company-wide warning saying that Huawei was simply trying to survive by focusing on cash flow and profit and that expansion and growth is no longer a priority, reported news.com.au.
This comes as China’s economy has been hit hard this year amid stringent Covid restrictions, souring international relations, an economic slowdown and a property crisis sparked by the collapse of real estate giant Evergrande.
After the message by the tech giant leader which warns of a “very painful” decade ahead, concerns have been sparked in China. “The next decade will be a very painful historical period, as the global economy continues to decline,” Ren reportedly said in the leaked missive.
“Huawei must reduce any overly optimistic expectations for the future and until 2023 or even 2025, we must make survival the most important guideline, and not only survive but survive with quality.”
CEO also supposedly added that it is unclear if Huawei can “break through” the 2023-2024 financial period. Ren also partially blamed Huawei’s struggles on Western countries including Australia indicating that the Western sanctions were threatening the conglomerate’s existence.
Notably, Australia was the first country to ban Huawei products in 2018 over national security concerns. Other western countries followed suit including the US, New Zealand and the UK. In May this year, Canada also did the same.