Japan’s decision adds to the
list of countries that have pushed back on Huawei’s involvement in 5G
infrastructure plans
Japan decided on Monday to
effectively exclude Chinese telecoms equipment giants Huawei Technologies and
ZTE from public procurement, the government said, adding to the list of
countries that have pushed back against the Chinese technology companies on security
issues.
The decision comes amid
concerns about security breaches that have already prompted the US and some
other countries to ban the two Chinese companies from supplying network
infrastructure products.
Cybersecurity officials of
relevant Japanese government ministries and agencies agreed on the plan, but
did not explicitly name the companies in consideration of the potential impact
on ties between Tokyo and Beijing, which have shown signs of improvement in
recent months.
Japan adds to the roll call of
countries who have effectively blocked Huawei from taking part in 5G mobile
network infrastructure build-outs, including the US, Australia, and New
Zealand, upping the pressure on the Chinese telecom equipment giant as it seeks
to take the lead in next generation mobile networks amid a trade and technology
stand-off between the US and China. The UK and Canada are weighing up the
possible security risks posed by Huawei too.
In August, the US, a key ally
of Japan, enacted the National Defence Authorisation Act to ban the
government’s use of Huawei and ZTE technology products and services on concerns
over their connections with Chinese intelligence.
Australia
and New Zealand have also excluded both firms from their next-generation 5G
mobile network roll-outs.
ZTE declined to comment on
reports of Japan’s decision on Monday. Huawei did not respond immediately to a
request for comment.
The Japanese ban marks the
first setback Huawei has officially encountered from its East Asia neighbours.
In August, when Japanese business newspaper Sankei Shimbun first
reported that Japan may consider a ban in a move to align it with the US and
Australia, Huawei said the news was “unsubstantiated rumour, and not factual”.
A Nikkei report on Monday
indicated that Huawei owned about a 13 per cent share in the telecoms equipment
market in Japan in 2017, compared with 18 per cent shares owned by local players
NEC and Fujitsu, respectively. Huawei’s consumer products, such as smartphones
and tablets, are also widely seen in Japan.
When Australia took the
decision to block Huawei from its 5G infrastructure in August on national
security grounds, Huawei said the decision was not aligned with the long-term
interests of the Australian people, and denied Australian businesses and
consumers the right to choose from the best communications technology
available.
“The Australian government’s
decision to block Huawei from Australia’s 5G market is politically motivated,
not the result of a fact-based, transparent, or equitable decision-making
process,” Huawei said in a statement at the time.
Meanwhile Huawei, the world’s
largest telecoms equipment supplier, last week agreed to British intelligence
demands to address risks in its equipment and software, as the company seeks to
be part of the UK’s 5G mobile network plans, according to a Financial
Times report last Friday.
Its comments came after BT
Group, which runs the UK’s largest mobile network operator EE, said last week
that Huawei will not supply equipment for EE’s core 5G network. It has also
started removing Huawei gear from EE’s core 4G infrastructure. That followed a
warning from the head of the MI6 foreign intelligence service that singled out
the Chinese company as a potential security risk.
The news has not been all
bleak on 5G for Huawei though. Last week Huawei signed an MoU to upgrade
Portugal’s No 1 phone network into the 5G standard.
Huawei will supply the
equipment and software for Altice Portugal to upgrade its network to support
commercially applicable 5G standards by 2019, the Shenzhen-based gear maker
said in a press statement.
The MOU in Portugal is the
latest deal after Huawei announced 22 commercial 5G contracts in November – 14
in Europe, five in the Middle East and three in Asia – putting the Chinese
company ahead of Nokia and Ericsson as the leading supplier of next-generation
telecommunications technology.
Meanwhile, in a move that
threatens to intensify the trade war between Washington and Beijing, Canadian
authorities arrested Meng Wanzhou, the chief financial officer of Huawei
and the daughter of its founder, in Vancouver on December 1 at the request of
US authorities. Meng faces US fraud charges associated with sanctions-skirting
business dealings with Iran, according to media reports.
In April, the US Commerce
Department announced a ban on US firms shipping products to ZTE, alleging the
company violated its sanctions against North Korea and Iran.
ZTE, the second largest
telecoms equipment maker in China, was first fined in early 2017 for selling
millions of dollars’ worth of hardware and software from US technology
companies to Iran and North Korea, which were under American sanctions.
The company was later found to
have lied about the matter, which led the US Commerce Department this year to
impose the seven-year ban.
The inability to buy
components from US suppliers resulted in ZTE’s closing major operations within
weeks. The company’s survival became a source of friction in trade talks
between Washington and Beijing. US president Donald Trump, in what he called a
favour to Chinese President Xi Jinping, directed the Commerce Department to
come up with an alternative, less crippling punishment.
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