5G under scrutiny by “five eyes” but business blinks first

The British Business Awards 2020 has just been launched by the British Chambers of Commerce here in China. It was great to be able to attend an offline event again. Local media were out in force and there was a real buzz around the audience – a lingering concern, of course, due to COVID-19’s continuing impact around the world, but an enthusiasm that businesses in China can now get stuck into actioning their recovery strategies.

On the other side of the globe, the British government has recently agreed to further collaborate with its “five eyes” security partners. The government’s aim is to investigate what options lie beyond Huawei for implementing a rollout plan for 5G networks in the UK. National security concerns underpin an apparent change in policy-makers’ convictions from January to push forward with a rollout plan including China’s 5G champion (albeit under strict limitations). Is the U-turn justified?

Not an easy question to answer. Particularly if you heed the stark warnings of Vodafone reported in this article. That said, these are operational alarm bells that industry insiders have been ringing for some time. A number of organisations have suggested that blocking use of Huawei’s equipment in Britain’s next-generation communications networks could set back implementation plans by up to two years.

On top of that in the UK is the indecision of Brexit negotiations and ongoing disruption caused by COVID-19. Is this the time to take two-steps back on the UK’s digitalisation journey?

A conundrum fortunately outside of my job description. However, there are real ifs and maybes arising from the uncertainty that strategists at companies which we talk to are having to plot a course through. Not only businesses in the UK that will be directly or indirectly impacted by the timing for when 5G can be rolled out, but also those enterprises operating in China.

Many an eyebrow was raised at foreign chambers of commerce meetings in China when the final text of the new Foreign Investment Law was reviewed in March 2019. Little article 40 stood out for its cautionary description of possible “corresponding measures” against any country that “takes any discriminatory, prohibitive, restrictive or other similar measure against the People's Republic of China”. “Dangerous” was the simple label given by one high-profile European business leader based in Shanghai.

In light of the tit-for-tat policy moves and rhetoric that has continued from Washington and Beijing for much of time since release of the Foreign Investment Law last year, the outcome for the UK of any decision on its 5G infrastructure is therefore not only a double-edged sword; for British telecoms and related businesses that operate both at home and in China, it could rather be seen as a sword of Damocles hanging over their operations in two crucial markets.

Who now has the commercial and political astuteness to lower that sword?