National security or Western tech monopoly - Real reason behind West's hostility toward Huawei

Huawei is banned in the US, and the European Union is pushing for a ban on its mobile networks. Henna Virkkunen, the Vice President for the European Commission of Technological Sovereignty, Security, and Democracy, has decided that the member nations of the European Union should phase out high-risk vendors, such as Huawei and ZTE. Already banned in the United States, a Chinese state-funded company faces extreme hostility from the West. In 2019, the US blacklisted Huawei on the pretence of national security, citing that Huawei's telecommunication device contains a 'backdoor' which enables surveillance by the Chinese Government.

Why is the West hostile towards Huawei?

On the surface, the US claims that Huawei is a state-funded company, and China's National Intelligence Law 2017 binds state companies with the government in intelligence operations. But since the revelations by Edward Snowden, a National Security Intelligence contractor and whistleblower, the level of spying by the US government, both within the country and overseas, is appalling. From data access on major online platforms to snooping on phones of at least 35 world leaders from countries like Brazil, France, Mexico, the UK, China and Germany. Notably, the former Chancellor of Germany, Angela Merkel, said that ‘spying among friends’ was unacceptable. Snowden was charged with violation of the Espionage Act of 1917. He is now living in exile in Russia.

Contrastingly, when faced with a spying allegation in 2010, Huawei opened a review centre in the UK called Huawei Cyber Security Evaluation Centre, which allowed UK government security officials access to Huawei's technology for review. But it changed nothing; in reality, West doesn't want the dominance of a Chinese company, which is effectively run by its employees. 151,796 current and former workers jointly run the company on an employee share ownership plan. Huawei shares are not publicly traded, and it makes individual payouts to employees annually. So no one can buy out the company or control it, and it's more innovative and successful than Western brands. For 2024, Huawei paid $10 billion in dividends to its employees. This is a stark contrast to companies like Apple and Alphabet, which have aggressive share buyback policies to keep the share prices higher. In 2024, Apple spent $110 billion and Alphabet spent $70 billion in share repurchases. Huawei CEO Ren Zhengfei considers this share buyback a wasteful model. In 2024, Huawei invested nearly 20.8 per cent, approximately $25 billion of its total revenue in research and development. Despite the US sanctions, Huawei is now leading the market in telecommunications and 5G technologies. It holds over 150,000 active patents and is the largest smartphone company in 2024. In reality, Huawei's success threatens the corporate ownership model sold by the US; so the agenda of ostracising Huawei, which shows the free market is free until Western companies stay on top.