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UK Decides British Companies Can No Longer Buy From Huawei

STEVE INSKEEP, HOST:

The U.K. is banning Huawei from supplying equipment for the next generation of British communications. Huawei is the Chinese company that is bidding to build much of the world's 5G network. British officials were going to allow Huawei to install equipment in their 5G upgrade but changed their minds. Oliver Dowden, the U.K. digital secretary, spoke in Britain's House of Commons.

(SOUNDBITE OF ARCHIVED RECORDING)

OLIVER DOWDEN: From the end of this year, telecoms operators must not buy any 5G equipment from Huawei. And once the telecoms security bill is passed, it will be illegal for them to do so.

INSKEEP: Telecom security concerns are part of this story. NPR's current London correspondent and former China correspondent Frank Langfitt is on line. Frank, good morning.

FRANK LANGFITT, BYLINE: Hey. Good morning, Steve.

LANGFITT: Or good afternoon where you are, I should say. What changed?

LANGFITT: Well, what Dowden said today in the House of Commons is he focused on U.S. sanctions. There are new sanctions that came out, I think, in May that said - they were basically designed to disrupt Huawei's ability to get its own chips manufactured. And so then the U.K. said, well, if you can't get your own chips manufactured and you have to go to third parties, that makes us very nervous about security and the ability of China to actually use 5G to spy on British government as well as British citizens.

But there's - you know, as we've talked a lot about this, Steve, there's a much bigger picture here. This is a part of a geopolitical battle between the United States government and the Chinese government over technology and security, as well as economics. And both have been putting a lot of pressure on the U.K. to take sides on this. And even after making this decision you mentioned earlier back in January, the U.K. has changed its mind and has decided to go with its longtime ally, the United States.

INSKEEP: And this is such a huge change because Britain may have made this decision in January but that actually relied on Huawei's equipment for many years. What's the effect in the U.K. of saying Huawei must go?

LANGFITT: It's big. And telecom companies do not like this for obvious financial and economic reasons. And what Oliver Dowden said today is Huawei has to be completely out by 2027. That's going to delay the country's 5G rollout by at least a year. And the cumulative cost of all of this - there were earlier sanctions against Huawei - could be up to 2 billion pounds so maybe in the neighborhood of $2.5 billion. What's clear here is the United Kingdom government is putting politics and security over the cost for consumers and saying this is more important, and this is just a burden we're going to have to bear.

INSKEEP: China cannot like this.

LANGFITT: No.

INSKEEP: It has openly campaigned for Huawei.

LANGFITT: Yeah. So the ambassador here, Liu Xiaoming - he threatened consequences if this happened in a hour-long press conference that I watched. I think it was last week. And the expectation is China will target other companies, British companies, because of this. And Huawei, of course, has insisted all along it wouldn't spy. But what we can probably expect is an escalation of sort of difficult relations between these two countries.

INSKEEP: Well, there are many issues...

LANGFITT: Yeah.

INSKEEP: ...That are difficult between the U.K. and China. How does this fit in?

LANGFITT: For one thing, the United Kingdom has been very unhappy with the way China handled the initial outbreak of the coronavirus and particular in using disinformation to actually try to blame it on other sources. Of course, in Hong Kong, Beijing has also instituted a new national security law, which curtails freedoms there - Hong Kong, of course, a former British colony.

And all of this has kind of alienated and angered politicians here and faced the United Kingdom with a choice between sort of commerce versus security and identity. I was talking to Steven Tsang. He's a professor at the School of Oriental and African Studies, University of London. This is how he put it.

STEVE TSANG: For a country like the United Kingdom with a proud history of its advocacy for the rights of individual for being the country where rule of law was born, we have to uphold our basic core values.

INSKEEP: Hadn't the United States been campaigning for just such a decision as Britain has made today?

LANGFITT: Absolutely. And I think that President Trump would have to be very happy about this. There's been pressure on for a long, long time in this geopolitical battle between these two countries. And this for now is definitely a win for Trump as he sort of battles China across the globe.

INSKEEP: NPR's Frank Langfitt is in London. Frank, thanks.

LANGFITT: You're very welcome, Steve. Transcript provided by NPR, Copyright NPR.