Though in recent years its image has suffered accusations that it is too buddy-buddy with China’s government–an accusation it categorically denies–China’s telecom darling Huawei has done well for itself internationally, establishing sales in critical markets abroad and creating one of China’s first recognizable international brands. Yet it has run into issues time and again with government regulators in developed economies who see Huawei as a security threat.
Apparently that is beginning to change.
Looking for new investment, the UK is opening its doors further to Huawei, who will be injecting approximately $2 billion into the UK to expand its operations and create 700 new jobs in the next five years. The news was brought to light yesterday just as the UK kicked off its expansion into 4G mobile services.
Meeting with Prime Minister David Cameron on Tuesday, Huawei’s CEO Ren Zhengfei detailed his plans for the expansion. “The UK is an open market, which welcomes overseas investment. I am, therefore, very pleased today to be announcing the $2 billion investment and procurement plan, promoting the development of openness and free trade,” Reuters quotes Mr. Ren as saying.
On his part, David Cameron stated that Britain’s government “values the important relationship with China” and that “both countries have much to offer each other.”
Half of the investment will focus on building the workforce, while the other half will be spent on components. Huawei will be participating in Britain’s recently announced expansion into 4G services through network operator EE (formerly Everything Everywhere). Some of Huawei’s equipment, including smartphones, mobile wifi hubs, and mobile broadband dongles, will be used for the new service.
Considering that Huawei has already been denied access to critical projects and markets in the US, Australia, and India, this news is unusual. It is perhaps an indication that with its finances still in a bind, the UK is willing to work with companies even if they are rather controversial. Huawei, on the other hand, will benefit from this development greatly if it can prove to its detractors globally that the Chinese government is not forcing its hand for espionage purposes in its expansion abroad.