[Beijing Diary] The Gong Launched by Huawei

The release of Huawei's latest smartphone model, the 'Mate60 Pro,' came without any prior notice. Even Huawei's PR office, which had been quite proactive in communicating with foreign journalists including Korean correspondents compared to other Chinese companies, provided no explanation?it was truly a 'surprise launch.'

When asked about the background, the person in charge replied that August 29, the launch day, was a commemorative day marking the total shipment of one hundred million units in the Huawei Mate series. They introduced this launch as the '100 Million Units Achievement Customer Support Vanguard Project.' The explanation was that they had been preparing to release the new product to coincide with reaching 100 million units, but since the exact date of achievement was unpredictable, they could not promote it separately.

However, a more persuasive interpretation of the background comes from the Chinese state-run media Global Times. The perspective is that releasing the product while U.S. Secretary of Commerce Gina Raimondo was visiting China was a declaration by Huawei, which had long faced severe sanctions and pressure from the U.S., to boldly challenge the situation. Here, substituting 'Huawei' with 'China' does not seem far off. If we were to add a rationale for the launch, it might be something like, 'Not selling parts and equipment? Fine, we'll make them ourselves.'

The U.S. was also shaken. They rushed to dissect the new product piece by piece to investigate which semiconductors were used and confirmed that a 7-nanometer (nm) chip was employed. U.S. public opinion has now shifted to whether there were any violations of export controls in the procurement and development process of this advanced chip and other components. This is why some quarters are mentioning the possibility of additional U.S. sanctions against China.

The allied countries, including the U.S., South Korea, and Japan, which have joined forces to pressure China through semiconductor regulations, are likely viewing the current situation with anxiety. The China pressure camp probably expected that China, disadvantaged in the supply chain structure after sanctions, would face difficulties in technology and product development. The expectation was that China would lower itself and endure a period of inconvenience and setbacks with a 'no teeth, but still supporting the lips' attitude (齒亡脣亦支). However, this prediction has been largely off the mark. China is now suddenly excising the infected area and beginning to implant dental implants into surprisingly healthy gums?ready to chew through anything.

How will the situation unfold going forward? It is highly likely to take on a more conflictual aspect. The Chinese authorities have banned the use of Apple iPhones within state-owned enterprises and related government agencies. Employees are not even allowed to bring them to work. In the one-party Communist system of China, it is only a matter of time before such directives spread to the private sector. Creating a justification is also very easy. Just as the U.S. pressured Huawei, China can cite 'cybersecurity' as the reason. From China's perspective, this will stimulate demand for domestic manufacturers, boost domestic consumption, and create a virtuous cycle encouraging investment and research & development (R&D). Meanwhile, the U.S. is discussing additional sanctions.

Recently, the Chinese state-run Global Times editorial commented on the controversy following the launch of Huawei's 'Mate60 Pro' as follows: "The cooperation between the two countries driven by China's technological advancement has been beneficial to the U.S. Technology cooperation is a large cake for the U.S. economy. Without the U.S. chip export ban, Huawei could have become a major customer and driven the development of the U.S. chip industry." Our problem is that this cake is not only for the U.S. South Korea may have to work hard to make a good cake but still wander around looking for a place to sell it.

This content was produced with the assistance of AI translation services.