With EU greenlight, Huawei 5G products to be made in Europe

Chinese technology firm Huawei will manufacture 5G products worth billions of euros annually in the European Union (EU), the company's representative in Brussels has told Xinhua.

Abraham Liu, Huawei's chief representative to the EU Institutions, said in an interview that the decision came from Huawei's global industrial setup and long-term commitment to Europe, which has a strong industrial base.

5G MADE IN EUROPE

5G -- which stands for the fifth generation -- technology takes a central role in bringing massive changes to mobile and fixed wireless data networks. Unlike the move from 3G to 4G where Internet speed increases about 20 times, 5G promises a quantum leap to fiber-like speeds in Gigabits per second with extremely low latency.

Photo taken on Feb. 6, 2020 shows Huawei products exhibited at "Masters of Digital", an anual event for experts to discuss the future of a stronger digital Europe, in Brussels, Belgium. (Xinhua/Zhang Cheng)

With that, the much-expected Internet of Things could be a reality -- devices can go online with virtually instantaneous interconnectivity, as 5G functions like the infrastructure of a real-time, precise command and control system.

Globally, Huawei is a leading 5G technology vendor, enjoying an edge over Sweden's Ericsson and Finland's Nokia in offering high-tech, low-cost gears to telecommunications operators such as Vodafone.

"Huawei is now the leading supplier on every continent except North America. The United States does not have an equipment supplier," U.S. Attorney General William Barr told an event at the Washington D.C.-based Center for Strategic and International Studies last week.

According to Liu, Huawei has decided to set up manufacturing bases of 5G equipment in Europe, in order to have "5G for Europe made in Europe."

The company already has supply centers in many parts of the world, including Latin America and the Middle East, but the factory for 5G "is going to be the first one" outside of China, Liu said.

"We are talking about the manufacturing center for 5G wireless products. It is not only about the product line. It is a full set of manufacturing center," Liu said. "The actual initial setup investment is very much dependent on the final decision about where we decide to put it."

"There are ongoing discussions at EU level and member states level," Liu added.

BOOST TO CREDIBILITY

For months, the U.S. government has been prodding its European allies into banning Huawei from participating in the construction of their telecommunications networks.

In defiance of U.S. pressure, the EU did not name either China or any specific company in its guidelines on 5G security issued last month.

Abraham Liu, Huawei's Chief Representative to the EU Institutions, receives an interview with Xinhua in Brussels, Belgium, Feb. 6, 2020. (Xinhua/Zhang Cheng)

When asked if Huawei's plan to pursue 5G manufacturing in Europe aims to further improve local confidence in face of the pressure, Liu said there is no need to link the two things together.

"We don't welcome any external political pressure in this case, but as I mentioned, this setup is in for a long term," he said, adding that the company believes it is "part of the European ecosystem."

Oxford Economics, a leader in global forecasting and quantitative analysis, published a study commissioned by Huawei in November 2019, saying the company contributed 12.8 billion euros (about 13.87 billion U.S. dollars) to Europe's gross domestic product in 2018, sustained 169,700 jobs, and supported the generation of 5.6 billion euros (about 6.07 billion dollars) in tax revenues.

"Because Europe is one of our strategic markets, we have a lot of globally important strategic customers in the region. We believe it will be a smart move to have this 5G manufacturing base set up to support the coming ten, twenty years' development in this market as well as the regions around here," Liu said.

When asked last week by Xinhua whether Huawei's decision to set up manufacturing bases would improve Europe's confidence in the security of Huawei products, former European Commission Vice-President Viviane Reding said "yes, of course," adding that manufacturing under European rules "will really be a boost to credibility."

MILESTONE DECISIONS

Huawei's presence and operation in Europe was boosted at the end of January, when Britain and the European Union, regardless of the U.S. demand to ban Huawei, announced their respective decisions to allow the company to participate in the building of their 5G networks, albeit with some restrictions.

"I believe that's an important milestone they have achieved. It's a balance of the political pressure and also their own business interests." Liu said.

Since it set up a research and development center 20 years ago in Sweden, Huawei has been increasingly involved in the world's largest trading bloc.

It now has more than 13,000 employees in Europe, and 73 percent of them are hired locally. Huawei maintains 23 research and development centers across 14 European countries and these figures are growing.

"We are working together with almost all the major operators across Europe to partner with them on their communication infrastructures," Liu said.

"Even if there is a number of customers that are not able to use Huawei, we think it's their business decision. We respect all the decisions from the customers," Liu added.

Phil Hogan, European Commissioner for trade, said in mid-January that Europe develops criteria by which people can trade fairly in an open market.

"We don't subscribe to the notion that 'whatever you do, you are blocked.' On Huawei, if they actually implement the rules of the game, there's an internal market in the European Union. All competition is welcomed but it must be fair," Hogan said via video connections to strategic advisory business Global Counsel's Politics of Trade conference in London.

"If you look at the toolbox released from the EU, they talk very much about the common standard, non-discriminative measures, one high standard applied for everyone," Liu said, referring to Brussels' latest guidance on 5G security.