Two issues have hit the company in the last week—they are unrelated but share a common theme: Total Dependence on China to ride out the U.S. blacklist, it seems, may not be such smooth sailing after all. Huawei needs to keep Beijing and China’s consumers onside—and that may be harder than it once seemed.
Recent hard hitting allegations that Huawei is more involved in the surveillance operations in Xinjiang than it has said in the past would ordinarily prompt the company to step back to shore up its reputation and image overseas. But it cannot risk any kind of snub to Beijing. And, closer to home, there is also now a viral backlash on social media against Huawei’s perceived treatment of a former employee who was jailed for crimes against the company. The timing could not be worse.
The modern parts of China’s industrial base give it strengths the Soviet Union never enjoyed, but also new vulnerabilities.