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China says blocking its two major global firms, Huawei and ZTE will slow developing countries’ access to digital age

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 By Chen Qingqing, Global Times

From remote Cape Verde inthe mid-Atlantic Ocean to rural villages in Cameroon, Chinese telecom equipmentproviders have for more than a decade helped local residents get access tomobile technologies. Excluding Chinese firms such as Huawei Technologies andZTE from participating in the development of internet communication technology(ICT) not only hurts the global supply chains, it also slows developingcountries from entering the digital age.
As Huawei continues to face growing challenges and even hostility inoverseas markets (including the recent arrest of its chief financial officerMeng Wanzhou), the company’s ambition to become an essential global supplier is being tested.

“Considering the scale of Chinese suppliers, exclusion of their products and services will certainly hurt ICT global supply chain,” Xiang Ligang, a veteran industry analyst, told the Global Times on Tuesday.” Plus, it will particularly hinder the development of mobile technologiesin developing countries where Chinese companies have been increasing theirpresence,” he said.
While China remains Huawei’s largest market, revenues from Europe, the Middle East, and Africa accounted for 27.1 percent of its total revenues in2017, followed by other countries in Asia Pacific with 12.3 percent and the Americas at 6.5 percent, according to the company’s annual financial report.
In rural Cameroon, Huawei helped establish an energy storage system, which allows 166 villages and more than 120,000 people to benefit from electricity with average annual power generation of more than 17 million kWh.
And in Cape Verde, volcano archipelago in the mid-Atlantic Ocean, the Chinese company is helping build a government services network and national data center, which later could be used in various scenarios including schools and hospitals, according to documents Huawei shared with the Global Times on Tuesday.
On average equipment made by Chinese suppliers costs 30 percent less than foreign rivals like Ericsson and Nokia. This allows Huawei and ZTE to invest more in services and maintenance, experts said. Lower costs and better servicing explain why Chinese firms have an advantage in developing countrieswhere governments have limited budgets for infrastructure and skilledmaintenance workers.
Western suppliers lack capability of delivering ICT products and servicesin some remote areas due to high costs, Cui Kai, research manager for IDC, toldthe Global Times on Tuesday.
“Chinese-made equipment has better operational performance, which canbe adapted to rural areas with limited resources. Huawei has deployed its basestations in Southwest China’s Tibet and accumulated experience in dealing witha harsh environment,” he said.
The company has already built over 500,000 base stations around the world,with more than 10 million commercial connections, and worked with over 1,000ecosystem partners, according to its annual report.
“As far as I know, Huawei employees are hardworking people who havedevoted themselves to those remote and poor areas,” Xiang said.
“Compared to those senior executives from Ericsson or Nokia who enjoyfirst-class flights and five-star hotels, Chinese staff is more capable ofworking with developing countries in building local networks,” he said.

Globalimplications
US giants including Intel, Qualcomm, Microsoft and Nvidia are among thetop US suppliers to Huawei, Yahoo Finance reported on December 7, citing areport from Goldman Sachs.
“Rejecting the Chinese company will hurt the US industry and othercountries as ICT is a highly integrated industry globally,” Cui noted.
Some analysts also suggested that banning Huawei will create a vacuum thatno company can fill in a timely fashion and may seriously impair 5G deploymentsworldwide.
Huawei is also the leading contributor to 5G technical groups, accordingto a report sent to the Global Times on Monday by IHS Markit, a globalconsultancy.
The report shows the Chinese company accounted for 15 percent of all 5Gcontributions while Ericsson accounted for 13 percent.
Following in the footsteps of the US, the Czech government has become thelatest country to warn network operators against using software and hardwaremade by Huawei and ZTE after the country’s intelligence watchdog raisedsecurity concerns, Reuters reported on Tuesday.
India’s telecom industry is also wrestling with idea of excluding Chinesesuppliers from government network procurement, according to media reports.Despite the concerns, the Indian government is allowing Huawei to take part in5G trials, along with other major suppliers such as Nokia and Ericsson, theTimes of India said.
Huawei has denied any suggestion that its equipment poses a threat tonational security and called on the Czech National Cyber and InformationSecurity Agency to provide evidence of its concerns instead of tarnishing theChinese company’s reputation, according to a statement the company sent to theGlobal Times on Tuesday.

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