The United Kingdom Bans Huawei From 5G Networks

Blog Post by Adam Segal
Council on Foreign Relations (CFR)

Newswise — Score one for the Trump administration. Months after announcing that it would allow Huawei to play a limited role in the country's 5G networks, the United Kingdom has reversed course. The British government has now decided that buying new Huawei equipment will be banned after December 31, 2020; all existing Huawei equipment will be removed from 5G networks by the end of 2027; and the existing ban on Huawei from the most sensitive "core" parts of 5G network will remain in place. Beijing and Huawei are, not surprisingly, unhappy, warning that the decision "threatens to move Britain into the digital slow lane."

This is an important win for the White House's efforts to block Huawei's international expansion, especially in Europe. In the face of U.S. pressure and threats—at one point, Secretary of State Mike Pompeo warned that a deal with Huawei endangered U.S.-UK intelligence sharing—British officials had argued that they could address the security challenges of allowing the Chinese telecom to build its 5G networks by keeping it out of the "core" and limiting it to 35 percent market share. These arguments gave cover to others who were on the fence about Huawei. If the United States' closest intelligence partner believed it could mitigate the risks, the thinking went in other European capitals, then perhaps we can also find a compromise that does not completely ban Huawei. That future no longer looks possible, and the pressure to keep Huawei out in Germany and France will grow. 

Two factors seem to be behind the U-turn. First, U.S. sanctions on Huawei, and the issuance of the Foreign Produced Direct Product Rule in May 2020 by the Commerce Department in particular, changed the risk calculus. UK intelligence agencies concluded that the sanctions would severely disrupt Huawei's supply chains and as a result it would be "extremely challenging to gain confidence in Huawei’s post-sanction equipment, and it may be impossible." Second, the COVID-19 crisis, the crackdown on Hong Kong, and other issues have led to a significant deterioration of UK-China relations. In a recent poll, 83 percent of respondents said they distrusted China. 

There is much work to be done. Transitioning away from Huawei will cost billions, and others, especially in the developing world, will not necessarily recreate the two factors driving British decision making. They are likely to find the economics of cheap, reliable Huawei products extremely attractive. The United States has begun to mobilize on the domestic side to encourage innovation and provide an alternative to Chinese telecom manufacturers, though there remains political infighting that slows the response. Still, after months of mixed messaging and seeming setbacks, the United States got what it wanted.

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