Huawei Technologies Co believes it can supply 5G hardware unaffected by US sanctions to the UK for the next five years, sidestepping the expected conclusion of British emergency review on Tuesday.
The company has stockpiled 500,000 pieces of kit, but fears a wider ban on its equipment is to be unveiled to placate rebel British Conservative Party lawmakers, who say that the Chinese supplier represents a national security risk.
The British government on Friday said that it was “very likely” that British Secretary of State for Digital, Culture, Media and Sport Oliver Dowden would make a statement to parliament on Tuesday after a technical review of the sanctions by the British National Cyber Security Centre (NCSC).
The US ban prevents Huawei from using US microchips or any chips designed with US software. The NCSC is expected to conclude that Huawei kit would no longer be secure because it would have to rely on untested chips.
The Chinese company said that it could divert 20,000 of its existing reserve for use in the UK, but it is unclear whether there would be any point in doing so.
“We can help, but why should we lean in when we are getting screwed,” one insider said.
Any material concession to Huawei would enrage rebel Tories. They want Dowden to ban new Huawei kit from the end of this year and insist existing kit be ripped out by 2023 or shortly thereafter.
Leaks have suggested the government would consider working towards a date of 2029, but the Telegraph on Friday reported that the British government is expected to set a deadline of 2025 for removing Huawei equipment.
“If Huawei thinks that any sweetheart deal that sees another five years of their kit installed can pass through parliament, they’re wildly mistaken,” a source close to the rebel group said.
BT Group and Vodafone Group this week warned that ripping out Huawei by 2023 could lead to signal blackouts. They also said that the cost to the two companies would reach several billion pounds and could be passed on to consumers.
O2 UK, the other leading mobile phone provider in the UK, does not use much Huawei equipment.
While the scope of the review is technical, the row has increasingly become geopolitical. This week, Huawei UK chairman John Browne, a former British Petroleum manager, said that the company had “become a football between the United States and China.”
US President Donald Trump’s White House has pressed hard for the UK to abandon Huawei, which has supplied telephone equipment to BT and Vodafone since the middle of the last decade, and is the market leader in 5G.
Huawei says it is a private company independent of the Chinese state.
Britain’s spy agencies have said there are no hidden backdoors in its equipment, partly because they have been able to monitor its software at a special evaluation center located in Banbury, England.
In January, British Prime Minister Boris Johnson announced that Huawei would be capped at 35 percent of 5G and would be allowed to supply only non-core parts of the network.
Dowden has previously said that he would delay the planned telecoms bill until after the summer recess if he announced a policy change next week.
That has prompted speculation that the government intends to delay a vote on its plans until after the US elections in November.
The British Labour Party accused the British government of agonizing over the decision. This claim was denied by the government.
“The Tories have dithered over this for years, lurching from review to review with no concrete action. In the meantime they have failed to invest in homegrown alternatives,” Shadow Secretary of State for Digital, Culture, Media and Sport Jo Stevens said.
Additional reporting by Reuters
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