Huawei, the Chinese telecoms giant, may see its role in the United Kingdom‘s infrastructure diluted as the country’s main communications provider seeks to increase the number of its equipment suppliers.
BT, the dominant phone company in the UK, is seeking a third vendor of kit for its Openreach division as it prepares a nationwide roll-out of full-fibre internet. Openreach currently relies on Huawei and Nokia, of Finland.
“We welcome a diverse and competitive market. Diversity leads to greater innovation and ultimately benefits customers,” Victor Zhang, vice-president of Huawei, told Al Jazeera.
“Huawei is proud to have been a supplier to BT since 2005, and we will continue to play a key role in supporting BT for building its broadband network. We look forward to a continued partnership that will help build a better connected UK.”
BT’s move comes as Huawei – the world’s largest telecoms equipment provider – is under pressure in European markets due to political tension over perceived cybersecurity risks and the fallout from the US-China trade war.
On Tuesday, Germany’s Chancellor Angela Merkel called for Europe to form a united front in dealings with China, particularly in the development of next-generation 5G mobile networks spreading across the continent.
While Washington has openly pressured global capitals to exclude Huawei from technology bids, it is likely that US-based firms would be among those hoping to snap up a contract with BT, Bloomberg reported on Monday. Cisco Systems and Adtran would likely be among those bidding for the work, it has been suggested.
Such a diversification may be of political – as well as systemic – benefit, say analysts.
“Research from Ivalua suggests that 68 percent of telecommunication businesses say that the number of suppliers they work with has risen in the last 12 months,” Alex Saric, Ivalua’s smart procurement expert, told Al Jazeera.
“This is because 91 percent of telcos say they have a high dependency on suppliers to help them deliver products and services, so by broadening the number of suppliers they work with they can mitigate the impact of geopolitical and regulatory risk. [Many] telcos also admitted to not having comprehensive and deployed contingency plans in place to prepare the supply chain for geopolitical changes.”
Western capitals are feeling pressure not just from Washington, but also over human rights concerns.
Beijing has detained more than a million of its own citizens, mostly ethnic Uighurs, and is holding them in what it describes as “re-education” centres in the far western region of Xinjiang. China says the measures are necessary to stamp out ‘extremism’ and has denied mistreating ethnic minorities including the Uighurs.
Meanwhile, pro-democracy protesters in Hong Kong have been demanding for months that people in the semi-autonomous Chinese territory should be allowed to choose their own leaders amid concern about Beijing’s creeping influence over the city.
And late on Wednesday, US President Donald Trump signed a bill into law that requires the State Department to certify, at least annually, that Hong Kong retains enough autonomy to justify favourable US trading terms, and also threatens sanctions for human rights violations.