This article first appeared in The Edge Financial Daily on November 27, 2017 - December 3, 2017

KUALA LUMPUR: Huawei Investment and Holding Co Ltd says it has unique advantages to defend its turf in the cloud computing services space, where it caters to medium-to-large enterprises and governments around the world, despite rising competition.

During his visit to Malaysia to launch Huawei’s first Asia-Pacific Innovation Day recently, Huawei’s rotating chief executive officer Guo Ping told The Edge Financial Daily that the group is known for having strong ground services for its cloud computing.

“For cloud service and the process of migrating businesses to the cloud, ground service is very critical, compared with other companies, Huawei’s services’ credibility are recognised by many and we can help customers, especially government and medium-to-large size enterprises, migrate to cloud in a very smooth manner,” he said.

“Compared with other companies in China like Tencent Holdings Ltd, which is very strong in social network; and Alibaba Group Holding Ltd, which is very strong in transactions data, Huawei, on the other hand, is very good at ground services. From Huawei’s perspective, the future of cloud services will not be a monopoly market,” he added.

Chinese technology giants have been steering their expansion beyond China in recent years, and Malaysia is one of their target destinations as the government here gears up its promotion of digital economic activities.

In November last year, Prime Minister Datuk Seri Najib Razak appointed the founder of Chinese e-commerce giant Alibaba Group Holding Ltd, Jack Ma, as Malaysia’s digital economy advisr. A year later, on Nov 3, Najib, together with Ma, attended the ground-breaking ceremony for Malaysia’s Digital Free Trade Zone (DFTZ) in Sepang.

Then last week, Reuters reported that Tencent Holdings Ltd, China’s biggest mobile gaming and social network company, is close to making Malaysia its first foreign country to roll out its WeChat e-payment ecosystem.

Huawei, which has been in business in Malaysia for the past 17 years, may not be involved in e-payment, e-commerce, or social network, but it is anticipated that the group will still face disruption from the advent of these two players outside China, in terms of cloud computing services.

However, unlike its competitor, Guo said Huawei has clear business boundaries and will continue to play its role as an information and communications technology (ICT) infrastructure solutions provider.

“Huawei has very strong partnership with its customers; I talked to a director of a bank in Malaysia and he told me he is very confident about Huawei because it will not touch the finance business, or use the credit investigation data of their customers to enter into finance business by themselves. In other words, they have very clear business boundaries,” he said.

“So it can build trustworthy partnership with its customers, Huawei can provide advance technology to them while we will not compete with them in their business domains. Although we started relatively late compared with the others, but I believe we will progress very fast,” he explained.

Meanwhile, commenting on Malaysia’s progress in promoting digital economy, Guo opined that the government should continue investing into ICT infrastructure to provide network access across the entire country.

“I think what Malaysia can learn from China is the investment in infrastructure, take Shenzhen as an example, the province has 2,000 more base station than the total number in Malaysia. Hence, Malaysia needs to intensify its investment in ICT infrastructure in order to have network access anywhere,” he said.

In view of the Malaysian government having limited resources as it is on its way to narrowing its fiscal deficit, Guo believes investment in ICT infrastructure can draw higher return on investment, especially for countries in the adopter stage of digital transformation.

“One example was when we deployed safe city solutions in 2014 in Kenya, where tourism is a pillar industry. Because of security issues, including terrorist attacks, their tourism industry has suffered for many years. We started with the country’s capital Nairobi, and followed that up with its biggest port, Mombasa. By the second year after deployment, crime rate was reduced by 46%. The following year, it fell a further 13%,” he said.

Guo said the improved security environment, in which authorities can expand their surveillance by tapping into other public and private security systems, has helped Kenya attract more tourists and investors. “It (safe city solutions) contributed to Kenya’s gross domestice product growth despite the economic situation in Africa being not very promising in the past few years,” he said.

Likewise, Guo believes deploying Huawei’s ICT solutions in Malaysia would help the country boost its economic activities.

“Malaysia has very rich tourism resources, and it is quite convenient for Chinese to travel here. If you deploy safe city solutions, I believe the government and police can benefit a lot, and it will also improve the investment environment and attract more investors as well as tourists. It is a good foundation of development for other industries,” he added.