Is Huawei’s future in jeopardy in the UK?

The UK’s January decision to limit Huawei to just 35% market share in the UK was lauded by most of as something of a compromise, trying to appease both the trade-war-fueled US and one of the market leaders in 5G technology. 

 

In reality, the decision was a huge loss of face for the US, who have since redoubled their efforts to get the Chinese vendor banned from UK networks.

 

One of the US threats on the table in the run up to the UK’s previous decision was that using a ‘high-risk’ vendor like Huawei would jeopardise the intelligence sharing between the two countries, as well as its Five Eyes allies.

 

At the time, this rumour was mostly quelled by the UK’s head of MI5, who said that he did not see any risk of jeopardising the UK’s intelligence relationship with the US, and indeed the threats did not materialise.

 

However, new sabre-rattling is taking place in the US, this time of an economic nature, with a bi-partisan group of politicians now pushing the Protecting America from Foreign Investors Compromised by the CCP Act, an Act that would remove the UK’s privileged ‘whitelist’ status when it comes to investing in the US.

 

Within the UK itself, pressure is also rising to revise the decision on Huawei. Led by ex-Tory leader Ian Duncan Smith, a group of hardline Conservative MPs are looking to pass a bill on Tuesday that would see the UK reduce its 35% cap on Huawei to 0% by 2022.

 

Reports on support for the amendment vary, with some sources suggesting up to 60 Tory MP’s may vote for the phase out, while others suggest this is exaggerated and real figure is in fact closer to 20. A total of 44 votes will be needed to threaten the government’s majority.

 

The question now is whether this renewed unrest on both sides of the pond really has enough bite to reverse the UK’s decision. Fundamentally, little has changed for the UK when it comes to its limited choices of 5G vendors – there are still few ‘alternatives’ that can contribute to 5G as quickly, cheaply, and effectively as Huawei. 

 

For the Chinese company itself, the UK’s decision earlier this year was a landmark win. Huawei has hoped the UK’s ‘fact-based approach’ will serve as a benchmark from which other European administrations are likely to take their cue. If the UK were, in fact, to phase out Huawei tech entirely, the move would have a geopolitical impact across the continent.