New analysis suggests that the restrictive policies imposed by the United States on China are inadvertently driving China's technological advancements. Industry insiders point to recent chip breakthroughs by Huawei Technologies as evidence of this trend, particularly highlighting remarks from founder Ren Zhengfei, who has downplayed the effects of US export controls.

In a front-page interview with People's Daily, published on Tuesday, Ren emphasized that Huawei is not overly concerned about the obstacles posed by US restrictions. He stated, 'In the face of external blockades and suppression, there is no need to think too much about difficulties; just take action and move forward step by step.'

Ren elaborated on Huawei's strategic approach to navigating US technology restrictions, focusing on increased investment and a commitment to theoretical research. He addressed concerns regarding Huawei's Ascend AI chips, asserting that many Chinese chip firms are thriving and that Huawei is just one player in a growing industry.

His comments follow assertions by Nvidia's CEO, Jensen Huang, who noted that Huawei's AI chip technology now poses competition to Nvidia's offerings. In this context, Ren remarked that the US tends to exaggerate Huawei's accomplishments, acknowledging that the company still lags one generation behind in single-chip performance.

According to Xiang Ligang, director-general of a telecom industry association, Huawei's successes illustrate how sanctions have inadvertently accelerated advancements in China's chip technology. Xiang noted, 'China's semiconductor industry, tempered by years of US sanctions, now boasts stronger prowess.'

Ren further addressed software-related issues, asserting that they are manageable. He described software as fundamentally built on mathematical symbols and code, stating that there are no inherent limitations in this area. Instead, he pointed to the education system and talent development as crucial challenges for the future.

Highlighting the importance of theoretical research, Ren argued that without a strong foundation in this area, even seemingly robust innovations could falter. He explained that high costs associated with foreign products stem from underlying investments in research and reasoned that China should invest in its own researchers instead.

Huawei's commitment to research and development is evident, with an annual budget of 180 billion yuan, of which 60 billion yuan is designated for theoretical research. Ren emphasized that major breakthroughs depend on such investments and that success in these endeavors is critical for China's competitive standing against the US.

Looking forward, Ren forecasted a long evolution for artificial intelligence, citing China's advantages of a youthful demographic and advanced infrastructure. He compared China's socialist market economy, which facilitates nationwide infrastructure development, to the more profit-driven approach of the US, as described by economist Richard Wolff.

In Ren's perspective, the success of projects such as high-speed rail and dams in China underscores the benefits of a socialist market economy, which supports initiatives that may not be immediately profitable but aim to enhance societal progress.