China’s considerations may include the risk of reinforcing a conservative rebellion that could push the release date of Huawei 2027 from the 5G network, and the fact that other countries are re-examining Huawei’s role. The United Kingdom is moving closer to other Five Eyes intelligence-sharing countries, the United States and Australia, by rejecting Huawei, but could define a new direction in Europe.
Beijing is also fighting on several fronts. The imposition of a draconian security law in Hong Kong caused an international backlash and highlighted other problems, including the treatment of the Peking people in Uighurs in Xinjiang and its increasingly harsh line in Taiwan. . His biggest battle is with Washington; On Tuesday, Donald Trump signed an order canceling Hong Kong’s special economic status with America. China is also grappling with Australia over Canberra’s calls for an independent coronavirus investigation and the offer of permanent residence to some Hong Kongers; with Canada, on Huawei; and with India, which has banned dozens of Chinese apps after a deadly border clash. Relations with the EU are becoming more strained.
But this proliferation of struggles reflects Beijing’s growing confidence and strength. Britain also seems much weaker than the last time China froze it, after David Cameron’s meeting with the Dalai Lama. At the time, trade actually increased and diplomatic relations continued at lower levels. But George Osborne’s subsequent push for a “golden relationship,” with human rights and other weak concerns on the agenda as long as money continues to flow, suggested that the United Kingdom will collapse whenever it feels the heat. The withdrawal from the EU left us without friends; and a post-Brexit country weakened by the pandemic will be particularly vulnerable economically. The United States, although they have urged other countries to choose a team, are completely inconsistent players.
We can expect more than diplomatic snobs this time. The example of Australia is interesting; it faces an export ban, hinted that China may be behind a cyber attack, and recently told its citizens that they could risk arbitrary detention if they went to China. British companies may well face new obstacles in China: HSBC would have warned Downing Street that it could be subject to retaliation if Huawei were blocked from the UK’s critical infrastructure. It was more like a deterrent to continue using the Chinese business. Why offer additional leverage for the future?
But a broader review is now necessary, with countries examining individually and collectively how we got to the point where Huawei was considered almost essential for 5G, while China would not allow a foreign company to play an equivalent role in its essential infrastructure. It might be convenient for the intelligence services to describe this as a failure of industrial policy – as Robert Hannigan, the former director of the GCHQ did on Wednesday – but there is also truth in his charge. It is time to consider what our technological and manufacturing priorities are and should be, where our companies should focus their efforts and how to encourage and support them.