ISSN 2330-717X

The Huawei-Decoupling Continues: Now, Italy Rejects China Tech From Its 5G – Analysis

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By Gautam Chikermane

If a 23 October sources-based news report by Reuters is accurate, Rome has joined StockholmBrusselsPrague, and London to exclude Huawei from its 5G rollout. Do not use Huawei equipment, the Italian Cabinet has reportedly told the Euro 2.2 billion by revenues telecommunications provider Fastweb.

As the geopolitical ball now rolls over to the Board of Fastweb, expect a bigger unwinding of Italy from China. Three months earlier, in July 2020, the Board of Telecom Italia had decided to keep Huawei out of its 5G rollout in Italy as well as in Brazil.

The rejection of Huawei in Italy, therefore, follows the playbook of private decisions, through company boards, rather than those of London or Stockholm, where the respective governments have come out to build security walls to protect their citizens from tech intrusions by Beijing.

The break-up of Italy with China over Huawei will be painful for Italy’s $2 trillion economy. Italy’s economy has been stagnant for the past 15 years, with its GDP flitting between $1.8 trillion and $2.4 trillion. To overcome this, it had latched on to Chinese Communist Party’s (CCP) Belt and Road Initiative (BRI) for growth, through a March 2019 seven-page Memorandum of Understanding (MoU).

By keeping Huawei — the biggest tool for security intrusion by China’s Chairman of Everything President Xi Jinping, CCP and People’s Liberation Army — out of Italy, Rome will face pressure on other aspects of the BRI deal. Unsurprisingly, the language and grammar of this deal, particularly the exit clause of settling differences amicably through “direct consultations” — not rule of law — seems to have been drafted by the CCP. Under Xi Jinping’s roguish playbook, Beijing will threaten and cajole Italy with harsh punishments and imagined benefits, for which Rome will need to be prepared.

Finally, we need to see Italy’s technological rejection of Chinese 5G equipment as part of a larger EU decoupling from Beijing. By rejecting Huawei, Italy has put enormous geoeconomic capital on the block. Being a G7 member adds weight to the exit, and should influence other two EU-G7 members, Germany and France, to ban Huawei.

As China Tech has discussed earlier, the extramarital affairs of the EU with China are ending and the 27-nation grouping is returning home to its liberal and democratic values; the authoritarian abuse of the relationship is ending. In the process, perhaps, the EU will rediscover itself and be more responsible to its people: a Beijing intrusion through Huawei carries a political risk that at some point will break out and impact voter behavior.

Observer Research Foundation

Observer Research Foundation

ORF was established on 5 September 1990 as a private, not for profit, ’think tank’ to influence public policy formulation. The Foundation brought together, for the first time, leading Indian economists and policymakers to present An Agenda for Economic Reforms in India. The idea was to help develop a consensus in favour of economic reforms.

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