Insight
Huawei, my way or the highway: Which way should the EU turn? by Ian Bond 18 June 2019
On May 15th, US President Donald Trump declared “a national emergency with respect to the threats against information and communications technology and services in the United States”. His action seemed designed to shut China, and specifically the telecommunications giant Huawei, out of the US market for 5G technology. On May 23rd, however, Trump appeared to suggest that he might be willing to ignore security concerns about Huawei as part of a trade deal with China. Trump’s first statement signalled an escalation of the conflict between the US government and Huawei. The US alleges that Huawei has links to Chinese intelligence and has violated US sanctions by supplying products incorporating US technology to banned destinations, including Iran. His second muddied the waters, suggesting that US security concerns would vanish if China offered the right trade deal. In a similar move last year, China’s other major telecommunications equipment provider, ZTE, was accused of breaching US sanctions on Iran and North Korea, but was spared punishment by Trump after China’s President Xi Jinping persuaded the North Korean leader, Kim Jong-un, to agree to a summit with the US. The Huawei dispute exemplifies a wider problem for the EU: as the US increasingly treats China as a “foreign adversary”, it also puts other countries under more pressure to take sides. If the US prohibits the inclusion of essential US technology in Huawei’s hardware, it will effectively force European countries to opt for other suppliers. But Europeans fear that if they exclude Huawei from their 5G networks, only for Trump to reverse course, they risk Chinese retaliation and commercial disadvantage. Despite its ‘special relationship’ with the US, the UK faces this dilemma too. The UK is reportedly planning to allow Huawei to supply certain kinds of 5G equipment regarded as less of a threat to Britain’s network. After a public warning by US Secretary of State Mike Pompeo against allowing “open doors for Beijing’s spymasters”, officials were braced for Trump to threaten to reduce US intelligence co-operation with the UK; but in his press conference with Prime Minister Theresa May on June 4th he said “We have an incredible intelligence relationship and we will be able to work out any differences”. European countries are in a quandary. The decision to ban or not to ban Huawei on national security grounds is one for individual member-states – they cannot leave it to the European Commission to make CER INSIGHT: Huawei, my way or the highway: Which way should the EU turn? 18 June 2019
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