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US Sanctions on Huawei Helping China’s Xiaomi Conquer Markets Around World, Report Claims

The US has justified sanctions on the Chinese firm by claiming that Huawei’s 5G equipment, sold around the globe, could be used by Beijing to spy on people. Both the Chinese government and the tech giant strongly deny Washington’s claims.

The White House strategy to cripple Huawei’s position on the global market has apparently borne unexpected fruit, putting another Chinese phone maker, Xiaomi in the top spot on smartphone markets, Forbes contributor Zak Doffman pointed out in an op-ed, citing the company’s financial reports for 2019.

Sanctions, first introduced against Huawei in 2019, banned the company from using Google’s app store and applications on its new phone models, which, as the media outlet argues, led to a drop in phone sales globally. The Shenzhen-based company subsequently announced plans to replace Google’s applications, but at present has no comparable alternatives and warned that 2020 might be a tough year in terms of financial results.

While Huawei comtinues to maintain its position on the domestic market, overshadowing companies like Xiaomi, the latter took advantage of its competitor’s woes and drastically boosted its exports, which now bring the company up to half of its total sales. Xiaomi has apparently taken on Huawei’s role as a supplier of cheaper top-tier smartphones, gaining more market shares in 2019 than Huawei lost in the same year, Forbes points out.

“[Xiaomi] had achieved the highest year-over-year smartphone shipments growth among the top five smartphone companies”, the Chinese company, based in Beijing, said.

Xiaomi’s overall revenue grew by 30% in 2019, the report says, indicating that the company witnessed 115% growth in the last quarter of the year on just the European market. It’s annual growth reached staggering numbers in some EU states, climbing to 206% in Italy, 69% in France and 65% in Spain. Xiaomi fared just as well in Asia, bringing its market share in one of its biggest arenas, India, to 30% last year, according to a report cited by Forbes.

US Crackdown on Huawei

Washington’s crackdown campaign against Huawei, which apparently took Xiaomi to new heights, started in 2019, when the White House announced a ban on selling American technologies to the Shenzhen-based tech giant, including software and chips. The Trump administration also started pressuring foreign countries not to purchase Huawei’s 5G equipment, but with limited success.

The US government claims that Huawei leaves backdoors in its equipment to allow Beijing to spy on its users, despite both the Chinese government and the tech titan vehemently denying such claims. Huawei filed a suit against Washington, which it sees as an attempt to kill a strong competitor. Beijing, in turn, promised that the American crackdown campaign against the Chinese company would not go unanswered, reportedly mulling a ban on the use of US software in government agencies, a major market for the American IT industry.