Huawei received huge financial subsidies from the Chinese government to help it rise, the Wall Street Journal said in a 25-issue article. In response, Huawei said in a statement on the afternoon of the 26th, the Wall Street Journal’s report is based on misinformation and confusing logic, ignoring Huawei’s huge investment in research and development over the past 30 years and the long-term customer-centric struggle of 190,000 employees. Huawei reserves the right to take legal action to safeguard its reputation.
The following is the full text of Huawei’s statement:
Huawei, a 100% employee-owned private company, has spent 10 to 15 percent of its annual sales for more than 30 years, and has invested about $73 billion in research and development over the past decade. Huawei spent $15 billion on research and development in 2018, ranking fifth in the world in the 2018 EU Industrial Research and Development Investment Rankings, well ahead of Cisco (25), Nokia (27) and Ericsson (43). From 2009 to 2019, Huawei spent more than US$4 billion on research and development in 5G, more than 5G in Europe and the United States. The huge investment in research and development has driven Huawei’s innovation and development, which is a key factor in Huawei’s success.
Huawei’s relationship with the Chinese government and other private companies operating in China are no different from the Chinese government’s. Like other high-tech enterprises in China, including foreign-owned enterprises, we enjoy the Chinese government’s policy support for high-tech enterprises, with out of no special treatment. Huawei’s operating capital comes mainly from the accumulation of its own operations and external financing, rather than government subsidies. In the past decade, the enterprise’s own business accumulation accounted for nearly 90%, the company’s external financing operations are market-oriented operations, debt costs in line with market level.
In fact, in China, high-tech companies that meet the conditions, including foreign-owned enterprises, are entitled to apply for subsidies from the Chinese government, mainly to support research projects, and Huawei applies for them through normal channels. As reported in the report, subsidies for high-tech research projects are also common in Western countries. Over the past decade, Huawei has received less than three-thousandths of its revenue from domestic and foreign research and development-related government subsidies, and in 2018 it will account for only two-tenths of its revenue.
Recently, the Wall Street Journal frequently conducted irresponsible selective reports on Huawei, which has had a huge impact on Huawei’s reputation. Huawei reserves the right to take legal action to safeguard its reputation.