Germany keeps world guessing on Huawei

Policymakers in Europe's biggest economy are struggling to arrive at a decision about the controversial Chinese vendor.

Iain Morris, International Editor

January 20, 2020

4 Min Read
Germany keeps world guessing on Huawei

Germany's top politicians are defying the country's reputation for Teutonic efficiency through a repeated failure to arrive at a clear decision about Huawei, a controversial Chinese equipment vendor that US authorities have slammed as a threat to national security.

Authorities in Europe's biggest economy have spent much of the past year pondering Huawei's future role in Germany's 5G networks. In the latest development, Chancellor Angela Merkel has asked policymakers to wait until after an EU summit in March before they decide, according to a Reuters report this week that cites sources involved in the talks.

An outright ban on the company would prove unpopular with German telecom operators, which rely heavily on Huawei's products. They have argued that a comprehensive ban would hinder 5G deployment and drive up network costs, with nasty consequences for the German economy.

A ban could also endanger relations between China and the European Union, hitting German exports. In recent years, China has overtaken the US to become Germany's largest trading partner, buying cars, machine tools and engineering equipment from German companies. According to a recent Reuters report, China's share of German exports has grown from 0.6% in 1990 to 7.1% last year.

These factors partly explain why a Huawei decision is fraught with difficulty. Political divisions are not helping, either. The CDU/CSU, the party of Merkel, is currently in a power-sharing coalition with the SPD. Merkel and some politicians in the CDU/CSU are wary of excluding specific companies, even if they support tough new security measures. But the SPD has tabled a proposal to ban Huawei that has been backed by some members of Merkel's party.

According to Huawei's opponents, allowing the Chinese vendor to help build Germany's 5G networks would be risky. Its products, they say, could feature "backdoors" enabling Chinese authorities to spy on Germany or even carry out cyber attacks. There may also be sympathy with US criticisms that Huawei flouts international rules on trade and rips off Western innovation.

Merkel is evidently looking to other European countries for support and keen to avoid any EU fragmentation on such a critical issue. Different regulatory approaches across the region would undoubtedly complicate matters for its telecom operators, some of which are active in numerous European markets. Those include Deutsche Telekom, Germany's partly state-owned national incumbent, which operates networks across a swathe of central and eastern Europe. The harmonization of telecom rules may be essential if Europe is to keep pace with China and the US in 5G: A regulatory divide over Huawei would hardly be helpful.

Want to know more about 5G? Check out our dedicated 5G content channel here on
Light Reading.

While set to leave the EU at the end of this month, the UK might provide a steer for Germany and take some pressure off Merkel. As a member of "Five Eyes," a US-led spy club that also includes Australia, Canada and New Zealand, the UK is being hounded by the Trump administration to jettison Huawei. Under a compromise designed to mollify China and its own service providers, it seems likely to exclude Huawei from the sensitive 5G "core" but not the radio access network. Unless this de facto rejection of calls for an outright ban met with a stern US response, it could be a guide for other European governments eager to minimize disruption.

That said, UK service providers have already taken steps to exclude Chinese vendors from their core networks. The same cannot be said for some other European operators, which have grown heavily reliant on Huawei in the 4G era. The Chinese might not care -- most of the 5G money is in radios -- but operators will not be silenced so easily: In terms of complexity, extracting a vendor from the core is more like brain surgery than dentistry, they say.

Related posts:

— Iain Morris, International Editor, Light Reading

Read more about:


About the Author(s)

Iain Morris

International Editor, Light Reading

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like