Huawei 5G ban: Chinese retaliation looms large over UK

The British government has concluded that reliance on Chinese telecom giant Huawei Technologies’ products posed an unacceptable threat to the security of telecom infrastructure and national security.

Announcing the ban, the government said “Huawei will be completely removed from the UK’s 5G networks by the end of 2027, following new advice produced by the National Cyber Security Centre (NCSC) on the impact of US sanctions against the telecommunications vendor. Ahead of this, there will be a total ban on the purchase of any new 5G kit after 31 December 2020”.

Prime Minister Boris Johnson’s decision angers China but delights US President Donald Trump by signalling that the world’s largest telecom major is no longer welcome in the West. The Chinese ambassador to the UK reacted sharply and said banning Huawei would mean the UK is treating China as a ‘hostile country’.

The Trump administration has repeatedly asked the UK to ban Huawei which it calls an agent of the Chinese Communist Party and its equipment could be used for espionage purpose. However, Huawei has long denied being an arm of the Chinese state, saying it is a private company owned by its employees. But it’s an open secret that Huawei is a crown jewel of China’s technological ascent. Its
executives are princes in the Communist Party.

As a result, the government decided that the UK operators should stop the purchase of Huawei equipment affected by the sanctions. There will be a ban on the purchase of new Huawei kits for 5G from next year and it will be completely removed from 5G networks by the end of 2027.

A statement by the government said: “the decision takes into account our specific national circumstances and how the risks from these sanctions are manifested in the UK.” Therefore, “the existing restrictions on Huawei in sensitive and critical parts of the network remain in place”.

UK Digital Secretary Oliver Dowden said in a statement: “by the time of the next election we will have implemented in law an irreversible path for the complete removal of Huawei equipment from our 5G networks”.

In January, UK Prime Minister Boris Johnson had stressed that Huawei would not be allowed to supply the core elements of networks and could have a limited role as a 5G supplier, amid claims by lawmakers and the Trump administration that Beijing could use the Chinese company’s kit to spy on western nations. The National Cyber Security Centre, a division of the signals intelligence agency GCHQ that has oversight of Huawei in the UK, was clear that it considered the company to be a ‘high-risk vendor’.

Huawei is the largest telecom equipment manufacturer in the world. It also produces smartphones and other consumer technology. The company is celebrating 20 years in the UK, which was one of its key breakthrough markets outside of Asia. Huawei equipment can be found throughout the UK’s telecoms networks.

The NCSC has worked throughout that time to ensure the UK safe and secure. But the new US sanction announced in May this year restricted the Chinese Huawei’s ability to produce important products using US technology and software in the design and manufacture of its products. The NCSC has looked very closely at the impact of these changes on the UK and no longer considered
that the UK would be able to manage the security risk of using affected Huawei technology in future 5G networks.

Losing the ability to supply 5G kit in the UK is a body blow to Huawei, which significantly slows its growth amid the political pressures. It has taken multiple initiatives to win over the British government. In May, the company unveiled plans to spend one billion pounds on a new research centre creating 400 jobs in the UK.

On June 30, the US formally designated Huawei and fellow Chinese company ZTE as posing threats to US national security, a declaration that bars US firms from tapping an $8.3 billion (Rs 62,600 crore) government fund to purchase equipment from the companies. In May, the Trump administration had banned shipments of semiconductors to Huawei from global chip makers.

In early July, Italy announced its intention of excluding Huawei from building its planned 5G network over security concerns.

In June, Singapore’s biggest wireless network operators chose Nokia and Ericsson over Huawei to build the main 5G networks in the city-state irrespective of its over reliance of Chinese technology.

The Head of French cyber security agency ANSSI said that French telecom companies were being encouraged to avoid switching to the Chinese company Huawei equipment.

Canada’s two largest telecom companies teamed up with Swedish Ericsson and Nokia to build 5G networks, ditching Huawei for the project in June. Canada is reviewing Huawei’s security implications of 5G networks in the country.

In January, the European Union (EU) said countries can either restrict or exclude high-risk 5G vendors from core parts of their telecom networks, a move targeting Huawei.

In 2018, Australia had banned Huawei from supplying equipment for a 5G network. In the same year, New Zealand, a member of the ‘Five Eyes’ intelligence-sharing network together with Australia, the US, UK and Canada, blocked service provider Spark from using Huawei 5G equipment.

The UK’s decision makes it harder for Huawei to expand further into other European networks, with a 5G platform in Britain seen as an important way point to further growth across Europe. The UK should prepare for serious retaliation.

Canada crossed Huawei and saw its citizens jailed in China. The Chinese Ambassador to London has already warned there will be consequences, hinting at a reduction in Chinese investment. The response could also include increased cyber-attacks against UK targets, new levies on British imports or greater restrictions on British companies operating in mainland China and Hong Kong..