UK companies are being warned by US partners not to cosy up to Huawei or ZTE due to ongoing worries at government level on the other side of the pond over the two Chinese companies.
The CEOs of two telecoms companies based in Cambridge admitted that US partners indicated that if they start to work together with Huawei or ZTE then they would have no choice but to abandon partnerships with the UK-based companies involved.
“Our American customers have made it clear to us that we cannot deal with Huawei or ZTE if we want to keep dealing with them – full stop,” one CEO, who wished to remain anonymous, told Business Weekly.
Another CEO added that its “partners in the States have no choice because of their government’s intransigence,” and they have been told “if it’s Huawei it’s the highway for you.”
Huawei has been plunging cash into the UK’s Internet of Things [IoT] sector in recent years including a new £125 milion chip and R&D lab in Bristol, £1.3 billion in investment across the country and the $25 million [£15 million] acquisition of Cambridge-based Neul.
As part of that acquisition Huawei has committed to constructing an IoT “centre of excellence” in the city and Neul’s “weightless” technology will be at the centre of this.
The US, however, is incredibly wary of Huawei and its counterpart ZTE and the two are banned from tendering for US government contracts due to worries over spying and espionage – something the Chinese businesses have been at pains to deny.
Europe has also expressed misgivings about state aid being used by China to assist Huawei and it has only just come to an agreement with the country’s government over what subsidies can be provided to the companies, which are heavily involved in Europe.
US misgivings over Huawei won’t slow its expansion in the UK and it remains to be seen whether UK companies choose to work with the Chinese firm instead of their current US partners.