Phone a Friend: Russia provides 5G lifeline for Huawei

June 18, 2019

2 min read

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What's going on here?

Huawei and MTS (a Russian telecom firm) have signed a deal to develop 5G in Russia.

What does this mean?

The Chinese tech company Huawei (which has faced several blocks for integrating its 5G technology in western countries) has signed a deal to create 5G networks in Russia in the coming two years. This has followed the allegation surrounding Huawei that the Chinese government will use its technology to spy on people.

President Trump has pioneered this attack on Huawei which has led to countries such as Australia, New Zealand and of course the US to block Huawei from supplying equipment despite Huawei claiming that it is autonomous and fully independent from the government. Therefore, this Russian deal could not have come at a better time for Huawei and China.

What's the big picture effect?

The ramifications of this deal extend out of the network industry and into the political world. Firstly, this deal may well keep Huawei in business. This is considering that the company depends on the US for its computer chips, and will now have to find an alternative supplier after being “blacklisted” by the US. Secondly, this deal strengthens the relations between China and Russia. The deal ran alongside China’s President Xi Jinping’s 3 day visit to Russia, during which he visited his Russian counterpart and “close friend” Vladimir Putin, who he has met with nearly 30 times in the last 6 years.

This relationship, reinforced through business deals, seems to be building an opposition to the Trump administration and therefore the US. The US and Russia have broken nearly all ties since the supposed influence in the electoral campaign. The relationship between the US and China seems to be following in the same footsteps, considering the recent trade war and treatment of Huawei. This deal therefore combats the US’s bid to weaken the ever-growing power of China and its economy.

With apparent divides forming in the political landscape, reinforced by such polarising commercial deals, the question remains how much will politics affect this business?

Report written by Mohammad H

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