Caixin
Jan 29, 2019 03:21 PM
YOUR BRIEFING

Tuesday Tech Briefing: U.S. Charges Huawei and CFO With Fraud, Trade Theft

1. U.S. Charges Huawei and CFO With Fraud, Trade Theft

The U.S. Justice Department has filed multiple criminal charges against China’s Huawei Technologies Co. Ltd., its affiliates and its chief financial officer, Meng Wanzhou, and said it is seeking Meng’s extradition to the U.S. from Canada.

The Justice Department unveiled Monday two indictments against Huawei, including nearly two dozen charges of bank and wire fraud, obstruction of justice and technology theft.

The charges are the latest blow to the Chinese telecommunications-equipment maker, which has been facing growing hurdles from foreign regulators over national security concerns. Several countries have blocked Huawei’s products from their next generation of 5G telecom networks. (Caixin)

2. Europe Should Act as One on Huawei, French Minister Says

“Talking to China, we can’t do it each state on its own. ... [W]e should act as Europe,” French European Affairs Minister Nathalie Loiseau said in Warsaw on Monday, commenting on the security issues related to Huawei, Reuters reported.

Some Western countries, led by the United States, have barred the use of Huawei’s equipment, especially in the 5G infrastructure, over security concerns.

Huawei has denied the claims and stated that it has received 30 contracts on 5G, 18 of which are from Europe, and shipped more than 25,000 5G base stations so far. (Reuters)

3. China Adds Nearly 100 New Startups to 2018 List of Unicorns

Nearly 100 companies in China achieved the status of tech unicorn in 2018, defined by reaching a valuation of $1 billion, according to a report (link in Chinese) from market research firm Hurun Research Institute.

E-commerce and video streaming companies led the way, with ByteDance’s Toutiao news feed, Tencent-backed video service Kuaishou and farmer-oriented e-commerce platform Meicai seeing valuations rise 400% in 2018.

China had a total of 186 unicorns at the end of last year, up from 120 at the end of 2017. While 97 names were added, 31 companies were removed because of initial public offerings (IPOs), mergers and acquisitions or declining business. Financially troubled bike-sharing giant Ofo wasn’t on the list. (Caixin)

4. Guangzhou Airport First to Launch 5G Networks

China Unicom, one of the country’s three big telecom operators, has established a 5G network covering Terminal 1 of Guangzhou Baiyun International Airport in South China’s Guangdong province.

That makes Baiyun International the first airport in China with 5G.

China intends to start testing commercial-quality 5G wireless services in several major cities in 2019 and could officially roll out commercial networks in 2020. (People’s Daily)

5. Chinese Banks Are Scrambling to Fund Tesla’s Shanghai Plant, Sources Say

U.S. electric-car pioneer Tesla is taking bids to fund its $5 billion China factory, and multiple Chinese banks are rushing to get involved.

A consortium made up of several Chinese banks has been formed to provide loans to the project, sources from several lenders told Caixin. But the leader for the group has yet to be chosen, and multiple plans regarding the details of funding terms have been presented to Tesla, these people said, asking not to be named as negotiations are still underway.

The Shanghai plant, wholly owned by Tesla, is the U.S. carmaker’s first outside its home market in the United States. CEO Elon Musk has previously said Tesla would seek local debt to fund the factory. (Caixin)

6. Didi Teams Up with China’s Biggest New-Energy Carmaker

China’s biggest ride-hailing company Didi Chuxing said Monday it has set up a joint venture with state-owned BAIC’s new-energy vehicle unit.

Didi-backed Xiaoju Auto Solutions and BAIC BJEV will develop electric vehicles and “networked cars,” which utilize integrated systems that allow communication among vehicles, roads and pedestrians, news outlet Caijing reported.

China’s minister of industry and information technology said recently that the country’s automotive sector will reach the goal of producing and selling 2 million new-energy vehicles in 2020, even though the industry continues to rely heavily on government subsidies to sell them. That amount would be double the sales total last year. (Caixin)

Compiled by Ye Zhanqi

Contact editor Michael Bellart (michaelbellart@caixin.com)

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