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Huawei Worried About Spies, Cuts “US-Linked” Staff

Summary:
Multiple sources have told the Nikkei Asian Review that Huawei Technologies "is redeploying senior executives and scientists who have US links due to growing concern inside China's biggest tech company that they could be co-opted by American agents and leak confidential data." Sources also said Huawei is fortifying electronic security systems between its headquarters in Shenzhen, China, and overseas offices to prevent security leaks. "Part of the reason that some American executives have left is that Huawei is worried that some of its local US employees have been contacted by US intelligence," said one source. "The company is worried that other senior executives [with US citizenship or residency] could be approached, too." Sources named several Huawei executives that have recently

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Multiple sources have told the Nikkei Asian Review that Huawei Technologies "is redeploying senior executives and scientists who have US links due to growing concern inside China's biggest tech company that they could be co-opted by American agents and leak confidential data."

Sources also said Huawei is fortifying electronic security systems between its headquarters in Shenzhen, China, and overseas offices to prevent security leaks.

"Part of the reason that some American executives have left is that Huawei is worried that some of its local US employees have been contacted by US intelligence," said one source. "The company is worried that other senior executives [with US citizenship or residency] could be approached, too."

Sources named several Huawei executives that have recently left the company.

One of those executives is Wang Hsin-shih, a Huawei tech development team leader based in Taiwan. Wang had connections to Silicon Valley, and recently left Huawei for "his US-links."

Huawei Worried About Spies, Cuts

Another source confirmed the departure of staff, adding that Huawei in Shenzhen was extremely concerned about U.S.-linked executives and researchers working at the company could easily be influenced by US government personnel to leak sensitive information.

The latest departure of US-linked staff is another troubling sign that decoupling between the US and China continues. Huawei has disposed of at least 70% of its employees at US subsidiary Futurewei, citing "curtailment of business operations" caused by President Trump's technology ban.

Huawei's direct US investment has collapsed to $5 billion in 2018, from $29 billion in 2017, and 2019 could be a lot worse considering the technology ban. Sources said that Huawei has gone through great lengths to prevent access to sensitive information in US offices, given the hostility between the company and the Trump administration.

"The company [Huawei] has built isolating firewalls between some overseas offices and its China headquarters to avoid the retrieval of internal information ... and staff access to Huawei intranets in China," the source said.

Huawei has wound down US operations, sources said, indicating that the Trump administration has made it too difficult to operate in North America. The company has since expanded throughout Asia and Europe.

Ross Darrell Feingold, a lawyer and political risk expert, told the Nikkei Asian Review that "the decoupling of global talent will [soon] become a reality."

The world's two largest economies are rapidly decoupling. Huawei is the latest example of the decoupling that is taking place in technology and manufacturing, which could lead to a volatile and challenging business environment across the world through the early 2020s.

Tyler Durden
Tyler Durden (a pseudonym) represents the idea that a return to truly efficient markets is a possibility and a necessity. After having experienced the inner workings of capitalism at various asset managers and advisors, Tyler believes that the current model is flawed and a deleveraging at every level of modern society is needed to reinspire the fundamental entrepreneurial spirit.

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