Chinese telecom behemoth Huawei was hit hard in 2020 due to the Trump administration’s economic actions against the company, but it has shown a remarkable capacity to recover. Since 2020, the attention of Western authorities has mainly shifted to other Chinese technology challenges, allowing Huawei to discreetly experience a revival in various products.
It is vital for Western decision-makers to stay on guard against Huawei, which, due to its global presence, has the unparalleled capability to execute the Chinese Communist Party’s plans for surveillance, data theft, and extensive sabotage. Despite facing multiple setbacks, Huawei continues to find ways to expand its connectivity solutions and maintain a strong consumer base internationally. As the company focuses on strengthening its 5G and IoT technology, it is essential for Western countries to closely monitor their efforts and assess the potential security risks associated with Huawei’s growing presence in telecommunication infrastructure.
The Trump administration’s actions against Huawei
In May 2019, the Trump administration added Huawei to the Commerce Department’s Entity List, significantly restricting its access to advanced American chips required for powering 5G-enabled devices. At the same time, the State Department encouraged American allies and worldwide telecom firms to commit to maintaining “Clean Networks,” which meant keeping 5G networks and other technological channels free of untrusted suppliers like Huawei and ZTE. This move severely impacted Huawei’s ability to compete in the global 5G market, as the company had to rely on alternatives for essential components to develop their devices. Consequently, global telecom operators had to rethink their strategies for adopting 5G technology, with many choosing to collaborate with other trusted suppliers to ensure secure and efficient network operations.
Global response to the Clean Network initiative
Many American allies and global telecommunication companies ultimately supported the Clean Network idea, resulting in a 29% decrease in Huawei’s total revenues from 2020 to 2021 and an 81% drop in Huawei handset shipments in 2021 compared to 2020. The pattern indicated that most developed countries, and perhaps the entire world, would eventually eliminate Huawei equipment. As countries continued to phase out Huawei equipment, the global shift towards more secure and transparent infrastructures became evident. This also opened up opportunities for other telecommunication companies to fill the void left by Huawei’s diminishing presence in major markets.
European countries reconsidering Huawei
Nonetheless, Huawei’s resurgence started in Europe. A few European nations that initially promised to exclude Huawei from their 5G networks have since appeared less committed to that pledge. In June, the European Union’s Technology Commissioner disclosed that only ten EU member states had restricted or removed “high-risk vendors.” This statement highlights the softened stance of some European countries towards Huawei, possibly due to the need for advanced technology and economic considerations. As a result, Huawei continues to gradually reclaim their position in the 5G market, despite ongoing scrutiny and security concerns.
France’s relationship with Huawei
By next year, France will be home to Huawei’s first mobile phone equipment factory, and the French government has reportedly decided to grant 5G licenses for Huawei in some cities. Although German leaders have expressed concern about “de-risking” from China, the country’s cybersecurity agency has acknowledged using Huawei equipment internally. This move by France signals a growing confidence in Huawei’s technology and highlights the diversification of 5G suppliers globally. Despite the concerns of other nations, France is paving the way for further collaboration with the Chinese tech giant, potentially making a significant impact on the 5G landscape in Europe.
Germany’s deliberation on Huawei
Chancellor Olaf Scholz spent all of 2023 deliberating whether to remove Huawei from Germany’s 5G networks. Germany recently faced the dangers of depending on an unreliable state for essential resources when it had to deal with the decrease in gas supplies from Russia – a mistake it should not repeat with its digital infrastructure. To avoid a similar situation with their digital infrastructure, Germany must assess the reliability of their 5G network providers and ensure a diverse supply chain. By considering alternatives to Huawei and potentially partnering with multiple providers, Germany can mitigate the risk of over-dependence on a single entity and bolster their national security in the process.
Huawei’s expansion into cloud services
Huawei’s cloud services are also expanding their market share globally, particularly in Latin America, where Huawei has overtaken Google, IBM, and Oracle. Furthermore, Huawei’s cloud data center in Riyadh, Saudi Arabia, will not only support government services but also act as “a bridge that will bring other Chinese companies to Saudi Arabia,” according to Huawei’s regional vice president. This move signifies a strategic step for Huawei in solidifying its position as a global leader in cloud services and enabling better access for Chinese firms to operate in the Middle East. As Huawei continues to grow, the company is anticipated to strengthen its partnerships and develop advanced cloud technologies to further compete with other key players in the market.
Cybersecurity risks and the Chinese Communist Party’s influence
As more global digital activities take place on the cloud, the Chinese Communist Party will have more opportunities to access sensitive information, infiltrate crucial infrastructure, and shape digital infrastructure standards to benefit its companies. Consequently, it is imperative for countries and organizations to implement robust cybersecurity measures and monitor their digital assets to protect against potential threats. Furthermore, international cooperation and open communication channels among nations can help create a secure environment, fostering innovation and growth in the digital sphere, while countering the influence of malicious actors.
Huawei’s Mate60 Pro smartphone and potential security risks
Perhaps the most alarming development for the world is the introduction of Huawei’s Mate60 Pro smartphone. Equipped with a 5G-capable seven-nanometer chip supposedly developed and manufactured entirely within China by the government-owned Semiconductor Manufacturing International Corporation, the Mate60 Pro demonstrates Huawei’s ability to circumvent U.S. export restrictions on 5G components and chip-making technology. This breakthrough not only poses a significant challenge for American firms, but also raises concerns regarding data privacy and security on a global scale. As Huawei continues to expand its production capabilities independently of U.S. suppliers, governments worldwide will need to reassess the potential risks and implications associated with the use of Huawei’s 5G technology in their telecommunication infrastructure.
Military and artificial intelligence applications
These high-tech chips might have significant military and artificial intelligence applications, further emphasizing the importance of excluding Huawei from 5G networks. It is worth noting that the Chinese government has prohibited its employees from using American-made devices and has introduced the Mate60 Pro as the official alternative. This move by the Chinese government demonstrates the ongoing tensions and security concerns between the two nations in the race for technological supremacy. As a result, it is critical for other countries to carefully evaluate the potential risks and benefits when deciding whether to incorporate Huawei’s technology into their infrastructure.
First Reported on: thehill.com
FAQ
What are the main concerns about Huawei’s global presence in telecommunications?
The main concerns stem from Huawei’s potential to execute the Chinese Communist Party’s plans for surveillance, data theft, and extensive sabotage due to its vast international presence and close ties to the Chinese government.
What actions did the Trump administration take against Huawei?
The Trump administration added Huawei to the Commerce Department’s Entity List in May 2019, restricting its access to advanced American chips and promoting the Clean Network initiative, urging countries and telecom firms to exclude untrusted suppliers like Huawei from 5G networks.
How has the global response to the Clean Network initiative affected Huawei?
Due to many countries supporting the Clean Network idea, Huawei experienced a 29% decrease in total revenues from 2020 to 2021 and an 81% drop in handset shipments in 2021 compared to 2020. This forced Huawei to adapt its strategies and focus on other areas of expansion.
How has Huawei been able to bounce back in Europe?
Huawei’s resurgence in Europe is due to a softened stance by some European countries, likely influenced by the need for advanced technology and economic considerations. Countries like France and Germany have either granted 5G licenses or acknowledged using Huawei equipment in their technology infrastructure.
What steps has Huawei taken in the cloud services market?
Huawei has expanded its cloud services globally, overtaking key players in Latin America and establishing cloud data centers in countries such as Saudi Arabia to support government services and act as a bridge for other Chinese companies to enter the region.
What is the Mate60 Pro smartphone’s relationship to Huawei’s resurgence and potential security risks?
The Mate60 Pro smartphone, featuring a 5G-capable seven-nanometer chip developed and manufactured entirely within China, demonstrates Huawei’s ability to circumvent U.S. export restrictions. This raises concerns about data privacy and security on a global scale due to its potential military applications, urging governments worldwide to reassess the risks associated with the use of Huawei’s technology in their telecommunication infrastructure.
