Ren Zhengfei’s Interview with The Globe and Mail

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Huawei Founder and CEO Ren Zhengfei sat down with The Globe and Mail to speak about Huawei and their plans for the future.

01 Nathan VanderKlippe, Asia Correspondent, The Globe and Mail: Thank you very much for agreeing to meet me again and speak with me as a Canadian journalist. Today, as you know, is the one-year anniversary of the arrest of Ms. Meng. So I’d like to ask you some questions about what happened a year ago. Because we know some of what happened in Canada, but we know less about what happened in China, and with you personally, around her arrest.

So can I ask first, Ms. Meng stopped traveling to the US two years before her arrest in Canada. Did Huawei know, beginning in 2017, that an investigation was underway and that she was at some risk?

Ren: Meng Wanzhou’s case seems to be part of a political campaign planned by the US. Huawei has been excluded from the US market for a long time. As our business shrinks in the US, we have virtually no business presence there. Even if our senior executives went there, there wouldn’t be any business to deal with. So why would they go? There is no need for them to be there.

Nathan VanderKlippe: So it was not to avoid an arrest in the US or to avoid legal problems in the US?

Ren: No. It was because there was no business for these executives to deal with there. Several years ago, we started treating the US market like a small market, with all decision-making authority delegated to our local office there. This was because the sales volume there was too small.

02 Nathan VanderKlippe: After she was arrested in Vancouver, can you tell me a little bit about how you found out about that, where you were at the time, who told you, and how that news came to you?

Ren: When she was arrested, I was in China and hadn’t started off to Argentina yet. The legal team of the company reported to me that she had been arrested, but we were unaware that this was all part of a big campaign from the US. We thought the case came from some misunderstanding.

Nathan VanderKlippe: You were supposed to travel to Argentina yourself. Were you also scheduled to fly through Canada?

Ren: No. I had planned to transit from Dubai to Argentina.

Nathan VanderKlippe: So she didn’t call you directly; she called the legal team at Huawei. Do you know why that was, why she called the legal team and not you?

Ren: It was a legal issue. So of course, she should reach out to them first.

Nathan VanderKlippe: Do you remember, after you found out, what your instructions were to the legal team? What did you tell them? What goal did you set for them?

Ren: I didn’t give them any instructions because I do not manage them. I only told other members of our senior management that we should get legal counsel for this case and engage with Canada through local legal means. We are determined to take legal measures to address this issue.

03 Nathan VanderKlippe: You said at first you thought it was a misunderstanding, it must have been some sort of legal misunderstanding. At what point did you think it could be a more important event, not just for Ms. Meng, but for your company?

Ren: On May 16, the US added us to the Entity List and started to sanction us. From that time on, we have realized that they are using Meng Wanzhou as a bargaining chip to attack us.

Nathan VanderKlippe: So you thought this was an accident or misunderstanding for five months, from December to May?

Ren: Yes, that’s what I thought.

Nathan VanderKlippe: So at that point, how did you think this would be resolved?

Ren: Getting legal counsel.

Nathan VanderKlippe: And after May, what did you think was the path to resolution? How did that change your thinking in terms of how long this could last and how to resolve it?

Ren: Ever since Huawei was added to the Entity List in May, we have believed that the US’s ultimate goal is to crush Huawei, and that Meng Wanzhou’s case is just the beginning. We believe that we must step up our efforts to adjust our internal structure and build a robust product development system to adapt to an environment in which sanctions are imposed on us. We have decided to do everything we can to ensure our survival. This is the only way for us to find solutions. So since May, we have made some changes and worked hard to ensure our business continuity.

04 Nathan VanderKlippe: Ms. Meng traveled, before her arrest in Canada, to six other countries that also have extradition agreements with the US. After Canada, she also planned to go to Mexico and Argentina, both of which have extradition agreements with the US. In your view, why did Washington pick Canada as the place to arrest Meng Wanzhou?

Ren: I think you’d have to ask Washington. If we had known Washington made that decision, Meng Wanzhou would never have gone to Canada in the first place, and we could have avoided dragging Canada into the current difficult situation.

Nathan VanderKlippe: I think there’s a belief in Canada that perhaps the US saw Canada as a weak country that will do whatever the US asks it to. Do you think that could be part of the reason Canada was selected here?

Ren: I don’t think so. I think Canada is a great country. The citizens of Canada and the US share common ancestry, but I believe they differed in their treatment of the Indigenous peoples. I think Canadians are great and noble people, and being polite and respecting rules does not mean they are weak.

Nathan VanderKlippe: So do you see Canada as having been compliant with the rules in this case? Because Canada has suffered consequences from the perspective of exports, from the perspectives of some Canadian people. Do you think those consequences are unfair for Canada?

Ren: Please allow me to clarify. I am not talking about whether Canada follows rules in Meng Wanzhou’s case. I simply wanted to share my belief that Canada and the US have treated the Indigenous peoples differently in previous centuries, and that I think Canada is a noble country.

Nathan VanderKlippe: Do you believe Canada was merely following the rules here or do you believe that Canada was also politically interfering in this case?

Ren: I think the US has clearly intervened in this case, and Canada has suffered losses because of that. I think Canada should ask Trump for compensation.

Nathan VanderKlippe: After Ms. Meng was arrested, can you tell me about the immediate reaction of the company? For example, were her family members immediately taken out of Canada or did they stay in Canada?

Ren: Huawei has never been involved in the arrangements about Meng Wanzhou’s family members. We have just hired lawyers for her in Canada in order to protect the rights she has under Canadian law.

05 Nathan VanderKlippe: Huawei has ways to retaliate against Canada. Huawei sells equipment to Canadian telecommunications companies. Huawei employs many Canadians. Yet you seem to have chosen not to retaliate that way. Why not? You have the power to do that. You have the power to lash out.

Ren: First, because we believe Canada is a great country. As the US is closing itself off, Canada should become more open. Being open will present Canada with huge opportunities. For example, because many scientists are unable to obtain visas to the US, many large international conferences can be held in Canada instead. US scientists don’t have to travel a long way or apply for visas to Canada. With scientists from all over the world flowing to Canada, it is likely that the country will rise to become a new hub of science and technology. We have never changed our minds when it comes to selecting Canada as a better place for our development.

Second, Canada is home to the world’s three founding fathers of AI, and we are now increasing our investments and efforts in AI. Incidents such as Meng Wanzhou’s case won’t affect our strategic development and investment in Canada.

The Meng incident will eventually become a thing of the past, but Canada won’t. Therefore, we cannot easily give up on our strategic development in any country.

We are aware that during recent deliberations in Canada, some people proposed the idea that Canada should still choose Huawei’s 5G. If that were the case, we would do our best to help Canada build high-quality 5G networks. We thought Canada is close to the US, so we once had the intention of giving up on Canada in terms of 5G rollout.

With 5G, Canada can apply AI solutions in various domains, like unmanned mining production in frozen regions. Huawei is a global leader in autonomous driving. We can first apply this technology in mining carts and agriculture, making unmanned farming a reality and allowing tractors to farm the land 24/7. Farmers, though, will still need to add oil to the tractors. With AI, Canada will see an increase in agricultural and mining production, greatly improving living conditions and material wealth across the country.

Canada has built a solid foundation for AI. If the country positions AI as its national strategy, it is possible to become a global leader in this field.

As we invest in Canada, we can not only learn a lot of theoretical knowledge from the founding fathers of AI, but also use this technology to benefit Canadian society. We will not easily give up on any country. If we give up on one country after another because of one incident, then we will have no business presence anywhere in the world.

06 Nathan VanderKlippe: Obviously, Huawei’s problems in America are not getting any easier with time. Last time we spoke, you talked about expanding in Canada, buying real estate in major Canadian cities. I wonder if, number one, you have a sense of the scale of that expansion, how many people you want to expand to in Canada. And number two, if you have given thought to perhaps, moving the headquarters, making Canada the headquarters for your North American operations and not just Canadian operations.

Ren: The number of employees we have in Canada has reached nearly 1,200, and two thirds of them work on R&D. We will continue to increase our investment there in the future. In North America, as we don’t have any presence in the US market, our American headquarters will remain in Mexico. However, we will move our R&D center from the US to Canada.

Nathan VanderKlippe: When will that happen?

Ren: The number of employees in Canada is gradually increasing. In 2019, we have added 300 employees to our local office in Canada. Due to the Entity List, we are not allowed to engage with our employees in the US either by email or phone or get access to technology there. This is impeding our development in the US, so we are transferring our business to Canada.

Nathan VanderKlippe: But for the idea of moving a research center to Canada, is this a big move, or are we talking about moving just a few dozen people, or is this a significant move towards Canada?

Ren: It will be a significant move, and we will move step by step. One issue involved is whether having a US citizen or Green Card holder working for us in Canada violates the sanctions of the Entity List. This is one of our major considerations when making decisions. If having US citizens and Green Card holders working in Canada is not subject to the Entity List, we will make a large investment in the research center in Canada.

The impact of the Entity List on us includes restricting the supply of components to us and cutting our collaboration with universities and academic institutions. For the next step, we would like to see if the restrictions imposed by the Entity List could be relieved in the future, allowing US citizens and Green Card holders to work for us in our Canadian research center. This is also an important foundation for our development.

07 Nathan VanderKlippe: Looking back on the past year, the Canadian government is now of the belief that John Bolton, who was the national security adviser in the US, was behind the arrest of Meng Wanzhou in Canada. If that’s true, and if pressure for her arrest came from outside of the judicial system in the US, how should that affect what Canada does with regard to the extradition of Ms. Meng?

Ren: I read the article published by The Globe and Mail yesterday. This is only something to consider, and we haven’t got any proof yet. I feel sorry that Canada is stuck in the middle of the conflict between Huawei and the US. However, what’s done is done, and what we should do now is to find an appropriate solution.

Canada is a great country, where the rule of law is strong, and my view has not been affected by the apparent violations by the Royal Canadian Mounted Police (RCMP) during the arrest of my daughter. Nevertheless, the RCMP officers had taken oaths regarding law enforcement. They should carefully review and clearly describe what happened at the key points because this can help process Meng Wanzhou’s case. They shouldn’t choose to be silent or pretend to lose their memories.

Huawei has not let this case stop its business development in Canada. We hope that resolving this case could put China-Canada relations back on track. We also hope the tensions between these two countries can be eased, and things can get back to normal.

The US is being closed off. Canada should open its arms to embrace the talent rejected by the US. This talent can help build a Silicon Valley in Canada. Many talented people are leaving the US, and Canada can open its doors to these people. The natural environment and standard of living in Canada are every bit as good as that in the US.

I think Canada should make policies accordingly, and take the path abandoned by the US, since the US is now taking the wrong path. So Canada can achieve what the US could not achieve. Canada shouldn’t blindly follow the US just because the two countries have good relations. Otherwise, how can Canada develop and rise?

08 Nathan VanderKlippe: One of the options available to Huawei regarding Ms. Meng is a settlement in the United States. Many cases in the United States end in settlements. There are legal experts that believe that if Huawei were to accept a settlement in the United States, it would receive a fine and then perhaps the extradition proceedings against Meng Wanzhou would be dropped by the United Sates. Why hasn’t Huawei accepted the settlement? Why hasn’t Huawei gone down this path in the United States?

Ren: The US government has never consulted us about the solution you mentioned. I hope you can relay a message to the US government and tell them to talk to us.

Nathan VanderKlippe: Would you be willing to explore such an arrangement with the United States? Is Huawei interested in a settlement in the United States?

Ren: Yes, but it must be based on facts and evidence.

Nathan VanderKlippe: Such a settlement would typically acknowledge or involve an admission of guilt and then some sort of arrangement, maybe a fine, maybe something else, but perhaps not jail time. So that’s a path you’re prepared to go down?

Ren: As I just mentioned, everything must be based on facts. We are open to negotiations on these matters as long as they are based on facts.

Nathan VanderKlippe: But you have legal counsel in the United States. Why don’t you order them to start exploring this idea or to raise this idea with American prosecutors?

Ren: Our lawyers state our case against the prosecution in court. This is a type of negotiation, which aims to determine who is right and who is wrong. First of all, the US District Court for the Eastern District of New York must disclose evidence and then we can debate in court based on the evidence. The debates our lawyers have with the prosecutor in court is negotiation in a loud voice. This allows both sides to first figure out what the facts are. Then we can negotiate, maybe in a lower voice, quietly, on exchange conditions. This is also a type of negotiation.

Nathan VanderKlippe: But you’re right now engaged in the court discussion. At what point do you think it’s time to have the lower voice discussion? At what point do you work specifically toward a settlement of some sort?

Ren: If the US government, which fails to find any evidence or justification for their act, decides to lower its voice, we can lower our voices too. Then the discussions will not take place in the courtroom. Instead, they can be held in a café. If we speak too loudly in a café, it annoys other diners, so we will naturally lower our voices. The topic of our discussion will be who drinks one more cup of coffee, that sort of thing. It will be about compensation. If it turns out the US has been wrong, then we would get compensated for reputational damage.

Nathan VanderKlippe: But in fairness, the US has put forth quite a lot of evidence and some of that evidence in particular was with regard to Ms. Meng and what Ms. Meng was doing with regard to some of the banks. When she was representing Huawei’s relationship with Skycom or as the US prosecutor has said, misrepresenting Huawei’s relationship with Skycom, was she doing that on your orders?

Ren: The US government should present its evidence through the court, if there is any. So far, we haven’t seen any evidence presented in court. The US District Court for the Eastern District of New York should disclose evidence as soon as possible.

Nathan VanderKlippe: But the US has released affidavits. They have released copies of the PowerPoints that Ms. Meng gave, I mean, that is the evidence that has been released through the legal channels, and it shows what the US says as a misrepresentation of Huawei’s relationship with Skycom. Was that misrepresentation made on your orders?

Ren: I didn’t give any order, but I think the US District Court for the Eastern District of New York should disclose the evidence and start the hearings as soon as possible.

Nathan VanderKlippe: Why did Huawei represent its relationship with Skycom as a divestment when in fact Skycom remained a subsidiary of Huawei?

Ren: We’d better leave this matter to the court to decide.

09 Nathan VanderKlippe: There’s a discussion in Canada about its 5G policy. Can you talk about what sort of contacts there have been between Huawei, or perhaps yourself, and officials in the Canadian government, with regard to the Canadian 5G review?

Ren: No. We haven’t had such discussions with the Canadian government. Huawei is not the only vendor that offers 5G equipment. Ericsson also offers 5G equipment. Whether Canada adopts 5G is one thing; whether they choose Ericsson or Huawei for 5G deployment is another. These decisions are all up to the Canadian government. If they choose Huawei for 5G deployment, then we will do our best. Even though they don’t choose Huawei, our investment plan in Canada will remain unchanged. We will continue to invest in Canada.

Nathan VanderKlippe: The Canadian government operates what is called a center for cyber security for testing digital products. It’s much like the testing lab that is in the UK, that has been in the UK since 2010. That Canadian center has tested Huawei’s 4G network technology. Has the Canadian center already begun testing Huawei’s 5G technology?

Ren: We currently don’t have a plan to establish a cyber security testing center in Canada. However, Canada and the UK are allies. They can have the equipment tested in the UK.

10 Nathan VanderKlippe: In September, you discussed the possibility of licensing Huawei’s 5G technology to other countries. Earlier last month, you said there had been no direct interest from American telecom companies. I just want to ask if that has changed and I want to ask how serious you are about this. Have you set up a data room for other companies to inspect your licensing? Have you set a price for licensing this technology?

Ren: First, no US company has approached us about the 5G license. Second, our license is comprehensive, with no restrictions attached. This is a very big decision, so it is understandable that US companies need time to think about it.

Nathan VanderKlippe: How much would it cost to license it? What would be the price?

Ren: This is hard to decide, because the sum of money involved would be huge. If it were going for a smaller sum, US companies would have made the decision long ago.

11 Nathan VanderKlippe: I just want to go back quickly to ask a follow-up question on the settlement. Do you see a settlement as a way of moving towards releasing Meng Wanzhou from Canada?

Ren: No. Meng Wanzhou has not committed any crime. The right thing to do would be to release her. In the lawsuit between Huawei and the US, the first thing is to find out who is right and who is wrong in court. If we were to plead guilty and pay a fine before that becomes clear, it would be no different from bribery. We won’t offer bribes to the US government. They need to make clear in court what’s wrong with us and present evidence to people around the world. After that, we can move the discussion to a café and decide who drinks two more cups of coffee. In the absence of any evidence, I will definitely not compromise.

Nathan VanderKlippe: It doesn’t actually sound like you’re that interested in a settlement.

Ren: Well, first of all, we need to make clear who is right and who is wrong. After that, we can discuss the possibility of a settlement.

12 Nathan VanderKlippe: Let me ask you one more legal question. You are preparing to mount a legal challenge to the FCC in the US over a decision with regard to rural carriers in the United States. First of all, is that correct? And are you planning other court challenges in the United States at the moment? You had almost no business in the United States. Why are you pursuing all of these lawsuits? It doesn’t seem like there is much to gain for you.

Ren: Yes, you’re right. We are going to sue the FCC. This is a right that the US Constitution gives us. We have the right to provide services to people in the US. It is up to the US carriers to decide whether to buy from Huawei. We are defending our Constitutional rights to provide services to the American people.

Nathan VanderKlippe: Is there more to come against the United States? I think this is the 6th lawsuit ongoing.

Ren: There may be more to come. It depends on whether we have enough legal counsel to handle those suits.

13 Nathan VanderKlippe: When you first spoke about licensing as an option, it sounded like a fairly new idea for you. And you have been asked many times, what sorts of options you have, from a corporate structural perspective, to try and win trust overseas? I’m wondering if you have given thought to any other options people have been talking about, like splitting parts of the company or relocating some of the company’s operations to other countries. Are there any other major corporate structural changes for you to consider?

Ren: First, our governance structure itself is open and transparent already. We don’t need investors or capital from outside the company. We have demonstrated that we are a responsible company in the way we serve people around the world. One or two people from outside the company alone cannot prove our transparency. Second, we won’t consider splitting our business. We will not accept external capital. Third, as to whether we will build bigger factories in Europe, we definitely will.

14 Nathan VanderKlippe: Just now you said you would consider a settlement. Are you open to a plea deal?

Ren: I don’t think that is possible.

Nathan VanderKlippe: But it would be a way to resolve this quickly. Over 90% of the cases in the United States are resolved through this sort of deal.

Ren: I think this is a matter of principle. We should figure out facts and evidence before discussing settlements.

Nathan VanderKlippe: But for many people in the United States, a plea deal is a way to avoid jail time. This could be a way for your own daughter to avoid jail time. Doesn’t that make it an attractive option?

Ren: Why would she go to jail when she hasn’t committed any crime? The Canadian judicial system is just. This is simply a way for the US to try and force us to compromise.

Nathan VanderKlippe: And it’s not worth it in this case, to proceed with your business and protect your daughter?

Ren: No, it’s not.

15 Nathan VanderKlippe: You talked about a factory in Europe, what would you consider manufacturing in Europe, and why Europe? For example, Southeast Asia has cheaper labor, as does Mexico. Why Europe?

Ren: Cost is not our consideration, strategic needs are.

Nathan VanderKlippe: I think there was a report that your Mate 30 phone has no US technology in it. I wonder if you can talk about that. I know that your company has been working very hard this year to try to get rid of all US technology. At what point, how long, from this point, do you think it will be before there is no US technology in your consumer devices?

Ren: This should be a reality next year.

Nathan VanderKlippe: I think initially you thought that it might be two or three years. Is that correct?

Ren: If this year counts, together with the next year, it will be two years.

Nathan VanderKlippe: But is it moving more quickly than you’d expected?

Ren: No, it will have been almost three years by early 2021.

16 Nathan VanderKlippe: Let me ask you just a clarifying question on this idea of a factory in Europe. What sort of things could you envision making in Europe and how quickly?

Ren: Large-scale 5G production. We are still reviewing the feasibility of this plan.

17 Nathan VanderKlippe: It’s been an extraordinary year for Huawei, and you personally, and your role at Huawei has changed very much in terms of how public you have been. I wonder if you can talk about how Huawei’s emphasis on government and public relations has changed in the past year. Do you have any sense of how much more you are spending on that now? Do you think that is a much more important task for the company than in the past?

Ren: First of all, I had to come forward since the company was in its time of crisis. Over the past years, our public relations department has made great efforts engaging with stakeholders around the world, and they have helped deepen the understanding of our customers and other stakeholders from all over the world.

For countries that don’t understand us, we have just stopped our public relations work there. But for those that still want to understand us, we have invested more and engaged more with them. Our total budget has not increased that much, because the money we’re saving from some countries is going towards public relations in others.

18 Nathan VanderKlippe: There have been many questions about how Huawei rebuilds or builds trust around the world given what’s happened in the past year. Do you see this as a trust deficit, if we can call it that, or a trust problem? Is that a Huawei problem? Or is that more a China problem, a problem for companies that exist in China?

Ren: Over this past year, I don’t think we’ve had a trust deficit; instead, we have gained a lot of trust, because the US government, such a great power, has been advertising for us, and we’ve gained a lot from it.

In the past, some countries may have been suspicious about Huawei. However, the US’s attack against Huawei has led them to trust us more because they’ve begun to realize that we are a great company.

This year, we have seen a 69% increase in the number of guests visiting Huawei. When some of them visited our production lines and saw that our new products did not have US components, they took the new versions back for testing. The results showed that the performance was really good, and that helped build their trust in Huawei.

Meanwhile, when they visited our campuses, they saw with their own eyes that the shuttle buses going to and from work were very busy and there were a lot of people getting on and off. They also saw that almost every canteen on Huawei’s campus – we have many canteens – was packed and our employees could still afford to buy meat.

Also, our production lines were running 24/7. That has further strengthened their confidence in us. So we haven’t suffered a trust deficit; instead, we have had a strong influx of trust.

When we were added to the Entity List, we estimated that we might see a decline in our financial performance this year. But so far, we have been maintaining strong growth. That’s a testament to the fact that we haven’t suffered a trust deficit.

19 Nathan VanderKlippe: But has much of your growth this year, which is just very strong, largely driven domestically here in China? Has it not been a form or a sort of state subsidy from state-owned telecommunications players to Huawei?

Ren: The growth of our network equipment business has mainly come from the overseas markets, so we mainly focus on guaranteeing our supply to our overseas customers. For our smartphone business, we have seen a decline overseas, but an increase domestically.

20 Nathan VanderKlippe: I want to just ask you quickly again, and I know your staff quickly pointed out you’re at a feasibility stage, but if you do move so much manufacturing to places like Europe, what are the advantages for Huawei in doing that? What problems does that solve for you?

Ren: AI will be fully applied to our future factories. So these factories won’t have issues that are quite common in welfare states in Europe or issues that European companies may have with trade unions. Though the cost may be a little bit higher, we will be able to win more trust, contribute more taxes, and create more jobs there. This will in turn help enhance our collaboration with European countries.

21 Nathan VanderKlippe: Huawei is building up an increasingly large, I believe the proper translation is, “smart surveillance business”. Huawei has been, of course, accused by the US, in particular, of being a risk of espionage in terms of the equipment. Why is Huawei moving into the surveillance business in such a big way? Your own manager, Duan Aiguo, has said Huawei wants to be number one in this space.

Ren: We are moving to a cloud-based, intelligent world, which will require huge information networks. The US is also seizing opportunities to move toward a cloud-based society. Our existing telecommunications networks will become cloud-based networks in the future. A cloud-based world will be far more open than we could ever imagine. Smart cities are just the beginning.

22 Nathan VanderKlippe: Your chief privacy officer, Mr. John Suffolk, was in the United Kingdom. He was asked about Huawei’s partnerships with the Public Security Bureau and other authorities in Xinjiang. And he was asked, in particular, does Huawei feel any moral obligation in terms of who it sells its technology to? And he said Huawei feels legal obligations. But many of these technologies that you developed can be used by governments to have a very severe impact on the freedom and liberties of people. Do you feel a moral obligation to assess who you sell technology to?

Ren: I read an article about the Xinjiang issue in The Globe and Mail recently. An in-depth look into this issue would be welcome. Which one do you think is better for the people, the US’s solution for the Middle East, or China’s solution for Xinjiang? Xinjiang has been gradually stabilizing in recent years, and there haven’t been any major social incidents or criminal cases there. Xinjiang’s economy is also growing. If a society’s wealth increases and its distribution becomes reasonable, many conflicts will gradually subside. The US should help the Middle East stabilize, develop its economy, and get the people there out of poverty. This way, the US will take the moral high ground.

Nathan VanderKlippe: Were you saying you don’t believe the United States has the moral high ground here?

Ren: The US has the moral high ground whenever it does things right. For example, several decades ago, the US contributed to the world by establishing a stable international system, which has helped maintain world peace and development. In return, countries around the world have acknowledged the US dollar’s status as the de facto international currency. However, the US is destroying the international order that it established itself. It can regain the moral high ground if it goes back to the previous normal order.

23 Nathan VanderKlippe: You have often spoken about your admiration for the United States. Your staff told me your favorite coffee is the Americano, you watched Star Trek, and you, of course, traveled to the United States. You have talked about the United States being at the top of Everest, and China being at the bottom of Everest. But do you expect within your lifetime to see the end of American dominance in technological terms, and perhaps economical terms?

Ren: I believe the US is a great country. The former Speaker of the US House of Representatives Newt Gingrich once also recognized Huawei’s strength. The US is leading in almost all areas except for 5G.

But even for the 5G industry, I believe the US has also made significant contributions. In the initial stages of 4G development, computer engineers in the US proposed the WiMAX standards. These engineers were young and more daring in their innovations. They proposed many new ideas, but they were too young and lacked expertise of the telecom industry.

The telecom industry is extremely complicated, since it must provide global network coverage and deal with networks from end to end. The documents of global telecom standards formulated by the ITU are probably many times what this room could hold. So it takes a lot of time to become familiar with these standards. Most scientists in the telecom industry are middle-aged and relatively conservative in their thinking. So many core technologies adopted by WiMAX greatly inspired the LTE industry, such as MIMO which can significantly increase capacity. Telecom scientists quickly incorporated many new ideas from WiMAX into the theories of LTE technologies. These innovations were then quickly put into practice, through the efforts of hundreds of thousands of telecom experts and engineers around the world, as well as the strong technological foundations that the industry had accumulated over the years.

A lot of 5G technologies, such as those enabling wider bandwidths, more antennas, and technology spanning multiple generations, were inspired by WiMAX. In the 5G competition between Huawei and US companies, Huawei has taken the lead not because we have unique advantages, but because we’ve gained inspiration from great ideas of many countries, and have helped realize 3GPP’s ideal. So Huawei also shares its inventions and technologies with the world. Huawei has signed many cross-licensing agreements with Ericsson and Nokia, as well as patent licensing agreements with Apple and Qualcomm. Huawei doesn’t have a technological monopoly.

The US is still a great country. US Secretary of Commerce Ross said in India that the US only needed two or three years to surpass Huawei. I believe what he said, but humanity cannot afford to wait that long for further development.

24 Nathan VanderKlippe: Just returning to the question that I had about Huawei’s moral obligations, or what moral obligations you see Huawei has. I’m thrilled that you’ve read The Globe and Mail, so thank you for that. But I meant to ask the question, not just in the context of Xinjiang, but your employees have been accused of helping African governments spy on, hack, and disrupt opposition politicians. Is that the sort of conduct that you accept from your employees or do you have a certain obligation not to do those sorts of things?

Ren: That news story about Huawei’s involvement with African government cyber security forces included false statements, and we have sent a legal demand letter to The Wall Street Journal. Also, a court in Lithuania ruled that the Lrytas UAB’s report about the so-called espionage on the African Union contained false statements about Huawei.

We are like a truck manufacturer that sells trucks to different countries. Whatever is transported is up to the driver, not us. What path to take and how to manage the equipment is the sovereignty of a country.

Nathan VanderKlippe: But some of the technologies that you’re developing as a company, like artificial intelligence, have the capacity to change society. They have the capacity to change the way economies work around the world. You are not building a truck that goes on a road and has its basic tasks. You are developing technologies like artificial intelligence, smart surveillance, and smart cities that actually have the ability to really change the way humans function as a society. Do you not have the responsibility to really think deeply about how those are developed and sold?

Ren: AI is not a weapon. We respect the digital sovereignty of every country. We must abide by the laws of each country and region we operate in, as well as international laws. On this basis, we use new technologies to benefit humanity. If a country rejects our new technology, we won’t take it there. We don’t want to create an unfavorable environment for that new technology when it just starts to emerge.

Nathan VanderKlippe: We were not just talking about AI. You have an interesting background. When you started the company, there were many elements in China about the planned economy, and you’ve been critical about the way it operated and the way it did not seek profit. You obviously did well when you left and entered a private economy. Do you think that AI is powerful enough or going to be powerful enough to bring back some elements of a managed economy in the future? Do you see AI having that sort of impact?

Ren: The macro environment should support market competition, because only competition can benefit users and drive companies to move forward. Inside a company, planning can help improve quality, lower costs, consume less resources, and reduce waste, and it will be conducive to competition. So for the planning you just mentioned, I think it’s only related to a company’s internal operations.

25 Nathan VanderKlippe: Let me ask a question related back to Ms. Meng Wanzhou. I wonder what your feelings are in terms of how she has dealt with the past year. Do you feel she is suffering or doing okay? What have you told her as far as how long she should plan to be in Canada?

Ren: As parents, we miss our children, of course, and Meng misses her children too. This has had a big impact on her life. Her mother and husband take turns keeping her company in Canada, and her children fly out to see her during the holidays. She also spends time studying and painting to keep her spirits up, and she just leaves all the details of her case to her lawyers.

We believe Canada has a legal system that is fair, just, and transparent. Transparency means we expect all the details of her case to be made public. We just need to wait for the court’s decision.

26 Nathan VanderKlippe: She wrote a letter which was posted on WeChat earlier this morning. You may have read it. She wrote a little bit about her thoughts about the past year and about her feelings now that she feels more ready, and prepared to face uncertainty. You said in the past that you do not expect her to succeed you in your role, but I wonder, if you look at what she has gone through and how she has faced her time in Canada, whether you have re-assessed your evaluation of her character or re-assessed your evaluation of her future in the company.

Ren: I didn’t read through the letter, but I saw the title this morning. I don’t think it’s appropriate, because the Chinese people are busy working, creating wealth, and striving to increase their income. They may not have time to think about what she feels. As shown throughout history, heroes are often born out of hardships. The hardships experienced by Meng Wanzhou will greatly strengthen her will, which will be of great value to her in life.

To be a leader of a technology company like Huawei, you must have deep strategic insight. You may need to have insight into the next 10, 20 or even more years. You should know in which direction a society or company is developing. So it would be difficult for people without insight to lead this company. For a technology company like Huawei, the leader must have a solid background in technology. Meng Wanzhou will assume the same role as CFO when she returns, except with stronger willpower than before.

The road ahead of Huawei won’t be smooth, and we may experience major setbacks and even the risk of collapse in the future. However, after experiencing these hardships, she will be able to better support us in surviving any future disasters. There are no companies in the world that always succeed. There is a book named Huawei: Leadership, Culture, and Connectivity, which says Huawei’s growth cannot be always smooth. I think disaster can be like wealth for us. Huawei has made great progress despite the attacks this year, and it seems that the risk will be mitigated slightly.

27 Ren: I’d like to recommend three Canadian “founding fathers of AI” to you. They are Yoshua Bengio, professor of the University of Montreal; Geoffrey Hinton, professor of the University of Toronto; and Richard Sutton, professor of the University of Alberta. Canada should position AI as a national strategy; Prime Minister Trudeau should invite these three “founding fathers of AI” for a coffee, and listen to their advice on how Canada should position AI as a development strategy. The University of Toronto is close to Harvard and MIT, and Vancouver is very close to the University of Washington and Stanford University. The question is, how can Canada attract talented people to support the “founding fathers of AI” in building a large industry cluster? They have led the world since 20 years ago, and they should not be like “flowers blossoming inside but only appreciated outside”.

Nathan VanderKlippe: You spoke about the three founding fathers last time we spoke as well. And I’m curious when you’re talking about Canada and the advantages of AI, are you speaking out of your interest in Canada as a country or are you also speaking in Huawei’s own interest? Do you see any interest for Huawei as a company in this?

Ren: No, I don’t see interest for myself or Huawei, because I separate my personal issues from Canada’s national development. I personally have some issues with Canada, but humanity is great. I do not take my personal issues into account when I look at the development of humanity. I once had a coffee with these three founding fathers of AI, and I think they are all truly great people. I suggest that Prime Minister Justin Trudeau enjoy a coffee with them every three months. Canada has a relatively small population, abundant resources, and a vast amount of land, so it is in urgent need of AI.

China, in contrast, doesn’t have such pressing needs for AI because China has a very large population. Many people ask negative questions like this, “If a lot of people lose jobs because of the wide adoption of AI, what should they do?” Canada happens to have a small population, so I think the country should proactively develop AI.

I will provide you with the email addresses of these three founding fathers. They will very likely help Canada develop and rise. When I recommend them to you, I am thinking beyond my own issues. This has nothing to do with Huawei. I just don’t want the light of these geniuses to be overshadowed.

Nathan VanderKlippe: So you didn’t meet them and offer them jobs?

Ren: They are the world’s most well-known figures in AI. If they come to work at Huawei, how can they unleash their potential through a low-level platform like ours? But we would like to provide them with research funds. While doing this, we will apply the US’s Bayh-Dole Act. We won’t seek to own any of their research results, and we will just provide them with funds with no strings attached. As long as the Canadian government allows us to do so, we will be prepared to offer them large amounts of funding.

The US considers 5G to be like an atomic bomb. Where did 5G come from? It came from a mathematics paper published 10 years ago by Turkish professor Erdal Arikan. I sincerely suggest that Prime Minister Trudeau invite these three founding fathers of AI for a coffee, as this will positively impact Canada’s strategic landscape.

Nathan VanderKlippe: Interesting. Do you think it’s a question of funding? When they have coffee together, do you think it’s a question of Trudeau offering more national funding or what do you think it is about? I mean, if you’re talking about Canada offering more support for these three founding fathers of AI, is it, for you, just a matter of national funding or something else?

Ren: No. I didn’t talk about Canada offering funding to them. If Canada positions AI as a national strategic industry, the team working on it will expand, and various applications will be developed, such as applications for unmanned mining and farming in frozen regions. This way, Canada can use AI to develop its economy. If these founding fathers need research funds, we will be happy to provide them, so that the Canadian government don’t need to provide the money.

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