Chinese kit maker Huawei is said to have quietly cancelled a £1 billion project to build a new research facility in the UK.

Having bought 500 acres of land in the Cambridge tech cluster – sometimes referred to as ‘Silicon Fen’ – back in 2018, the plan was to build an R&D campus for new optoelectronics products that could potentially be used in fibre networks. The first phase of the project would have seen Huawei plough £1 billion into the construction of a 50,000 square-metre facility. It also would have created 400 local jobs.

However, the Telegraph reported on Sunday (paywall) that Huawei has unofficially canned the project. It noted that construction has yet to start, even though the plan was to have phase one of the campus completed by 2021.

According to the report, planning permission for the site is due to lapse in August, and local councillors are having a hard time trying to get any answers out of Huawei. A company spokesperson told the Telegraph that the project is currently subject to an internal review that has been ongoing since the pandemic, and that it is aware that planning permission will expire in five months. The spokesperson didn’t say if Huawei still plans to begin construction within this time frame.

If Huawei really has decided to quietly cancel the project, it is an entirely understandable and reasonable move, given that it has been banned from supplying equipment to UK telecoms operators.

In late October, the government made its order to remove Huawei kit from networks by the end of 2027 legally binding, by issuing so-called ‘designated vendor directions’ to no fewer than 35 CSPs. At the same time, Huawei received a designation notice, formally categorising it as a high-risk 5G vendor and explaining why the government believes it poses a threat to national security.

Sunday’s development indicates just how far Huawei has retreated from the UK.

The government spent years cosying up to Beijing in an effort to attract investment. It was hailed as an achievement when – back in 2012 – Huawei pledged to plough £1.3 billion to expand its UK operations over a five-year period.

In May 2019, Huawei pointed out that its UK activities had boosted the economy to the tune of £1.7 billion, and that it was supporting 26,000 jobs either directly or via its supply chain. It also noted that it had spent more than the planned £1.3 billion over five years, and had actually invested £2.2 billion.

Announcements like this were falling on deaf ears by then though. The UK had already fallen in line with the US and other Western governments in taking steps to ban Huawei, and a little over a year after the company highlighted its economic contribution, it was banned from networks.

With all that has gone on, it makes no sense that Huawei should spend another penny in the UK, let alone £1 billion on an R&D site that will lead to precisely zero new UK sales further down the line.

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