Case Study:

Can Huawei Overcome Roadblocks in its Quest for Global Markets?

Huawei Technologies Ltd. (Huawei) has been integral in the global markets of the US, Australia, and the European Union for its telecom equipment.

In October 2019, Shenzhen-based networking and telecommunications equipment and services company Huawei Technologies Ltd. (Huawei) unveiled its 14-port and 3-D Hexa-beam antennas to address the challenges associated with the 4.5G and 5G era at the 5th Annual Global Antenna and Active Antenna Unit Forum held in Paris.

Commenting on the launch, Zhang Jiayi, president of Huawei's antenna business unit, said, "Huawei focuses on satisfying the requirements of operators in the MBB (mobile broadband) era." Founded in 1987 in Shenzhen by Ren Zhengfei (Ren), a former military engineer in the People's Liberation Army (PLA) - the unified organization of the armed forces of China, Huawei started as a sales agent for a Hong Kong-based company selling private branch exchange (PBX) switches. Soon, the company innovated and started selling its own PBX switches. Having established its domination over the Chinese telecommunications market, the company entered the global markets of Russia and Africa in 1996 and later mature markets such as the US and Europe.

The origin of Huawei Technologies Ltd. (Huawei) dated back to 1987 when Ren Zhengfei (Ren), a former military engineer in the People's Liberation Army (PLA), founded the company in Shenzhen with the aim of making it the backbone of China's communications industry. The company started as a sales agent for a Hong Kong company selling private branch exchange (PBX) switches with an initial investment of US$ 3400. By 1990, it had acquired enough resources to open its first research laboratory. In the same year, i.e. 1990, the company made its own PBX and started selling the switches to hotel networks at prices lower than those of imported devices.

1. Discuss the benefits of global expansion for Huawei.

2. How can international business and the role of the International Monetary Fund (IMF) aid in the promotion of international trade and foreign direct investment (FDI).

3. Do you think that the Chinese government should intervene in the international trade market for Huawei.

Defend your views.

(Total 20 marks).