Assignment No.6 Similar supply-chain challenges affect other parts of its business. Its coders are busily writing software tools known as compilers and libraries, themselves used to create the software that powers all manner of electronic devices, not just smartphones but also networking gear. As with Android, Huawei would have to create its own version of these, and a technological ecosystem around them. Such ecosystems take years to evolve, and there is only so much one company can do to stimulate this evolution, which relies on third-party developers, with their own goals and incentives. Huawei’s expertise in high, hard technology is of little use here. And, Mr Ren’s assurances notwithstanding, Huawei’s finances are being squeezed. Even he concedes that its relations with large Western banks such as HSBC and Standard Chartered have been disrupted. Still, the firm has plenty of cash and he says that smaller banks remain willing to lend to it. The Chinese Development Bank, which has reportedly extended credit lines to Huawei and ZTE, a Chinese competitor, in the past, may stump up if needed. Mr Ren and his underlings repeatedly claim that cashflow is “healthy”, pointing to the firm’s furious building work. It has just finished a 120-hectare, $1.4bn research campus. Huawei is being forced to transform itself from a company that makes and sells hardware into one that also makes many components that it used to buy from others. This kind of shift strains a firm. Its cash cow is under threat even as it has to invest heavily to replace the suppliers and software it can no longer get from America. Mr Ren may hope that his mooted sale of Huawei’s 5G technology will give him sufficient fuel for the company to fly ever higher. But peer behind the showy frescoes in Shenzhen, and his showier gesture, and Huawei’s future looks decidedly hazy ( The Economist , Sep. 14th , 2019)