This week the UK Government announced it will ban and remove Huawei equipment from Britain’s 5G network by 2027, marking a major u-turn after its decision to allow the company limited access.
Huawei has operated in Britain for the last 20 years and Europe represents a key market for the company, accounting for 24% of sales last year.
Following the government’s decision, network operators using Huawei equipment will be prohibited from purchasing any more after December and will be forced to remove what has already been installed.
The announcement has so far received mixed responses worldwide. The Chinese press has derided Westminster, calling for “public and painful” retaliation while US President Donald Trump appeared to take credit for the decision.
“I did this myself for the most part,” he boasted on the White House lawn.
The Huawei ban supposedly comes after wider strategic tensions with China and the country’s recent crackdown on residents in Hong Kong, a former British colony.
Matt Hancock today denied Trump’s comments, insisting the decision was independently made by the National Cyber Security Centre (NCSC). No mention of Hong Kong was made, however, despite lingering suggestions that the current political situation may have influenced the decision.
Digital Minister Oliver Dowden told lawmakers: “This has not been an easy decision, but it is the right one for the UK’s telecoms networks, for our national security and our economy both now and indeed in the long run.”
5G in Britain
There is no doubt that this was a big decision for Boris Johnson. Removing Huawei equipment over the next seven years will negatively impact the rollout of 5G, cost the British economy an extra £2 billion in costs and likely hit smaller, rural areas hardest.
BT’s chief executive Philip Jansen told BBC Radio 4‘s Today programme that it would be impossible to entirely remove the Chinese company’s hardware from the network before 2030.
“If you were to try and not have Huawei at all [in 5G] ideally, we’d want seven years and we could probably do it in five,” he said. “If you wanted to have no Huawei in the whole of the telecoms infrastructure across the whole of the UK, I think that’s impossible to do in under 10 years.”
Although the question of who will spearhead Britain’s 5G revolution remains unanswered, what is certain is that this latest decision will have a major impact across the country. 5G is seen as the future of network connectivity, and many industries were hoping to implement the technology into their working practices.
The concern now is that, if Britain has set itself back two to three years with this Huawei decision and is set to leave the EU, it may be left behind on the world stage as other countries rapidly adopt the technology.
Speaking at an online press conference on safeguarding national security in HKSAR, China’s Ambassador to the UK Liu Xiaoming said that breaking from Huawei would “damage Britain’s image as an open, business-friendly, free and transparent environment as it claims to be,” and will “tarnish your image as a country which follows independent policies.”
What happens next?
Britain’s exit from the European Union means it is more important than ever to form independent relationships around the world to help build trade connections, with Liu saying that relationships must be built on “mutual respect and mutual trust”.
Dowden has said sanctions imposed on Huawei by the US in May had “significantly changed” the landscape.
“Given the uncertainty, this creates around Huawei’s supply chain, the UK can no longer be confident it will be able to guarantee the security of future Huawei 5G equipment,” he said.
It is unclear whether the decision has been made with a future US trade deal in mind. President Trump has indicated that he many cut ties with any country that makes deals with Chinese companies such as Huawei, and Westminster may be looking to avoid falling out with its closest ally during such a critical period.
How China will react to the news remains to be seen. Liu Xiaoming tweeted that the decision was “disappointing and wrong” and that it has become “questionable whether the UK can provide an open, fair and non-discriminatory business environment for companies from other countries.”
Disappointing and wrong decision by the UK on #Huawei. It has become questionable whether the UK can provide an open, fair and non-discriminatory business environment for companies from other countries. https://t.co/fp1D9Yn2vt
— Liu Xiaoming (@AmbLiuXiaoMing) July 14, 2020
What is certain is that this decision is a major win for the Trump administration, which has consistently argued against deals with Huawei due to what it says are possible links to the Chinese government – accusations which the company strongly denies.
It is also a huge blow for Huawei, which was looking at expanding operations in the UK after the announcement earlier this year that the company would be allowed “limited access” to Britain’s 5G network.
Ed Brewster, a spokesperson for Huawei UK, commented: “This disappointing decision is bad news for anyone in the UK with a mobile phone.
“It threatens to move Britain into the digital slow lane, push up bills and deepen the digital divide.”