Ren Zhengfei shocks with deeply sinister forecasts. In a memo that was actually only addressed to Huawei employees, the company founder warned of a global recession and a “painful decade”. The letter seeps through and hits a nerve in the insecure population.
An alleged employee letter from Huawei founder Ren Zhengfei is currently making waves in China. As the British portal “The Register” reports, citing several Chinese media, the 77-year-old self-made billionaire predicts a long-lasting global recession and warns of the fatal consequences for his company.
There is talk of a “painful historical decade”. The alleged memo went viral shortly after it was published. Since then, the comments on social media have not stopped, it is said. Many are in a state of shock.
To the extent that the global economy is shrinking, the market pressure on the telecommunications equipment and hardware manufacturer from Shenzhen is also growing, the letter quotes. Ren Zhengfei already outlines that Huawei will probably give up some countries completely.
For Huawei, it is no longer about expansion, size or profits, but only about pure survival, especially for the years 2023 to 2025, the memo is quoted as saying. It must be ensured that Huawei “survives the crisis in the next three years”: All marginal businesses would have to be checked and, if necessary, closed. “Survival is the main program.”
The Huawei founder said to the workforce that the “cold” would be passed on to everyone. Employees would have to face reality and scale back all expectations. In view of the dramatic situation, he wanted “a shiver to run down their spines”: “No more illusions, no more storytelling.”
Losses would be “deducted from the food package,” “first you have to survive, and if you survive, you have a future,” quoted the Chinese portal NetEase. According to observers, the Chinese media group Yicai was the first to report on the memo. A long version was removed from the website, it is said. But even the shorter version is peppered with many quotations that correspond to those in other sources.
The CEO sees the blame for the upcoming dry spell in a combination of poor economic conditions, the war in Ukraine and US sanctions. Although Ren Zhengfei is known for his martial worldview, observers say his comments are devastating even when measured against that.
For many Chinese, the respected entrepreneur has struck a chord with his gloomy descriptions. “This is not the speech of an entrepreneur, but reflects the opinion of the people about the current economic situation,” the “Neue Zürcher Zeitung” quotes a post on the online platform Weibo.
Economic sentiment in China is at its worst in three decades. The economy shrank by 2.6 percent in the second quarter compared to the previous quarter. The country is particularly suffering from the state-imposed “zero corona policy”, which aims to nip any outbreak of the virus in the bud.
Every fifth person between the ages of 16 and 24 is unemployed. Problems on the real estate market are also having a negative impact on growth. The industry, which accounts for an estimated 13 to 30 percent of GDP, is in deep trouble. The drought is also affecting the economy. Large parts of the population are massively unsettled in view of the mixed situation.
It was only this Thursday that Beijing announced that it would loosen the equivalent of a further 146 billion US dollars in support measures. The expansion of investments should help “keep economic activities on a steady course,” said China’s Premier Li Keqiang. According to the English-language blog Pekingnology, Huawei did not want to comment on the alleged statements by Ren Zhengfei. The journalists interpret this as confirmation of the existence of the memo.
