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Huawei forecasts slowing growth in international markets amid spying allegations

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Huawei forecasts slowing growth in international markets amid spying allegations

Huawei Technologies Co. Ltd. has forecast slowing growth in its international markets this year as national security concerns over espionage plague the Chinese technology giant.

Speaking at a roundtable meeting Jan. 15, the company's billionaire founder Ren Zhengfei said growth would not exceed 20% in 2019 due to "challenges and difficulties in the international market." He added that restrictions on Huawei in some countries would create opportunities for rival vendors such as Nokia Corp. and Ericsson.

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Huawei founder Ren Zhengfei

Source: Huawei

The group's annual revenue is expected to reach US$125 billion in 2019, he said at the meeting in Shenzhen, China.

Fears about the security of Chinese-made equipment, particularly in the supply of critical 5G infrastructure, have led to federal or commercial bans on Huawei's services in the U.S., New Zealand and Australia. Japan is also said to be considering a ban. While the U.K. has not imposed any restrictions on Huawei, it identified national security risks associated with its equipment earlier in 2018.

Zhengfei, who established the business in 1987 and holds a 1.14% stake, also denied allegations of spying at the meeting.

"We would rather shut Huawei down than do anything that would damage the interests of our customers," he said.

Huawei's security record was brought into sharp focus after the arrest of Zhengfei's daughter and deputy chairwoman of the company Meng Wanzhou in Canada for allegedly violating sanctions against Iran.

Zhengfei declined to comment on the legal proceedings but said he anticipated an "open, just and fair" conclusion.

He also refused to comment on the more recent arrests of a Chinese Huawei employee and a former Polish security services officer on spying charges but confirmed the company would cooperate with the investigations.

"We stand strongly against any behavior that violates laws and regulations," he said.

Huawei is a major vendor of networking equipment to mobile network operators, with a footprint across 170 countries and regions. The company has signed more than 30 commercial 5G contracts with carriers and has shipped 25,000 5G base stations to markets globally.