Caixin
Aug 27, 2022 04:40 AM
ECONOMY

Opinion: Winter Is Coming to China’s Tech Sector

Ren Zhengfei
Ren Zhengfei

Huawei Technologies Co. founder Ren Zhengfei predicted a grim future for the world economy this week in an internal memo to employees. He said Russia’s war with Ukraine and the U.S. tech blockade against China will make the next decade “a very painful period in the human history.”

To prepare for a prolonged recession, he urged the company to immediately cut all unprofitable product lines, and “pass the chill to everyone.”

So he did. After the memo became public, the Chinese stock market tanked Aug. 24. Prices of more than 4,400 stocks plunged, representing nine out of 10 companies listed on mainland stock markets. The auto and semiconductor industries were hit particularly hard.

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