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Question for people in the know about UK politics - The IT and sec community knew about, or at least strongly suspected, Huawei and the Chinese government's tig

Question for people in the know about UK politics - The IT and sec community knew about, or at least strongly suspected, Huawei and the Chinese government's tight relationship for years. How did Huawei become so embedded in the UK 5G implementation?

redis_mlc 6y ago
Huawei subsidizes/finances buildouts (ie. dumping), making alternate choices not worthwhile in the US, and presumably elsewhere. The UK is in a special situation where the CCP can tie Huawei purchases with financial listings, yuan bonds, etc. in London.
jariel 6y ago
Product, scope - and especially money. They have 5G products/patents early, they are a 'one stop shop' for everything on the roll out. Chinese companies are cheap and compliant. 'They just say yes' and do it. Aside from the gov. collusion, the odd trade artifact is financing. They're offering their services along with really cheap financing - basically, pay nothing now, pay later, with incredibly juicy terms from some large Chinese state-owned bank. What major carrier wouldn't want to roll out 5G 'for free' and pay later! Very powerful esp. in developing nations. So without getting into issues of state security - you have once again a real problem with trade asymmetry. Usually in trade negotiations, it's against the rules for the government to intervene in a sector because said government can subsidize the sector and 'dump' on local markets. China did this with Solar Equipment for example, mass subsidizing Chinese makers and running everyone else out of business. The cheap loans are definitely a form of subsidy and it's a really sneaky problem. Imagine if the White House had direct ownership over all the main banks - and total control over the Fed - and colluded strongly with Cisco. The WH could order Morgan Stanley to make massive loans, on the cheap, to Cisco's customers abroad, totally undercutting their competition. In this case Morgan Stanley can pull it of because the Fed in this case would also be directly controlled, so all of this would have guarantees. So this is not how 'free markets' work and so we generally don't trade on these terms, because the 'central authority' entity can crush domestic competition otherwise. It's rational for China to pursue this strategy, but it's blatantly out of step with trade deals, WTO etc. It's a 'divide and conquer' tactic, which leading nations have to stand up against. So long as China is playing 'hard nationalism' with markets, then other nations have to respond with the same mode - 'hard economic nationalism' - otherwise, they risk getting seriously damaged. This is not a situation where we can play 'open and nice' while trying to get China to play along, it doesn't work that way. It's like they have an extra 2 players on the field. You're going to lose - you have to put an extra 2 players on the field yourself, even if it's irrational and crams up the field a little bit for everyone. It's like a strategy game. To be cynical and we should a little - this is part of China's vassalage strategy - and how to gain major leverage over nations and major industries of other countries. This is what is happening in the 'Belt and Road' initiative and already it's looking a little toxic in some places, particularly poorer countries. [1] [1] https://www.theatlantic.com/international/archive/2019/10/china-belt-road-initiative-problems-kazakhstan/597853/ https://www.theatlantic.com/international/archive/2019/10/ch...

redis_mlc 6y ago

Huawei subsidizes/finances buildouts (ie. dumping), making alternate choices not worthwhile in the US, and presumably elsewhere. The UK is in a special situation where the CCP can tie Huawei purchases with financial listings, yuan bonds, etc. in London.

jariel 6y ago

Product, scope - and especially money. They have 5G products/patents early, they are a 'one stop shop' for everything on the roll out. Chinese companies are cheap and compliant. 'They just say yes' and do it. Aside from the gov. collusion, the odd trade artifact is financing. They're offering their services along with really cheap financing - basically, pay nothing now, pay later, with incredibly juicy terms from some large Chinese state-owned bank. What major carrier wouldn't want to roll out 5G 'for free' and pay later! Very powerful esp. in developing nations. So without getting into issues of state security - you have once again a real problem with trade asymmetry. Usually in trade negotiations, it's against the rules for the government to intervene in a sector because said government can subsidize the sector and 'dump' on local markets. China did this with Solar Equipment for example, mass subsidizing Chinese makers and running everyone else out of business. The cheap loans are definitely a form of subsidy and it's a really sneaky problem. Imagine if the White House had direct ownership over all the main banks - and total control over the Fed - and colluded strongly with Cisco. The WH could order Morgan Stanley to make massive loans, on the cheap, to Cisco's customers abroad, totally undercutting their competition. In this case Morgan Stanley can pull it of because the Fed in this case would also be directly controlled, so all of this would have guarantees. So this is not how 'free markets' work and so we generally don't trade on these terms, because the 'central authority' entity can crush domestic competition otherwise. It's rational for China to pursue this strategy, but it's blatantly out of step with trade deals, WTO etc. It's a 'divide and conquer' tactic, which leading nations have to stand up against. So long as China is playing 'hard nationalism' with markets, then other nations have to respond with the same mode - 'hard economic nationalism' - otherwise, they risk getting seriously damaged. This is not a situation where we can play 'open and nice' while trying to get China to play along, it doesn't work that way. It's like they have an extra 2 players on the field. You're going to lose - you have to put an extra 2 players on the field yourself, even if it's irrational and crams up the field a little bit for everyone. It's like a strategy game. To be cynical and we should a little - this is part of China's vassalage strategy - and how to gain major leverage over nations and major industries of other countries. This is what is happening in the 'Belt and Road' initiative and already it's looking a little toxic in some places, particularly poorer countries. [1] [1] https://www.theatlantic.com/international/archive/2019/10/china-belt-road-initiative-problems-kazakhstan/597853/ https://www.theatlantic.com/international/archive/2019/10/ch...