Italy reportedly blocks Huawei 5G deal as Bulgaria joins US ‘clean network’ scheme

Huawei’s steady stream of European setbacks continues with a report that the Italian government has vetoed a 5G deal between the Chinese vendor and Fastweb.

The scoop comes courtesy of Reuters, which says it has spoken to three anonymous sources on the matter. It reports the decision to veto the 5G core deal was made in a cabinet meeting late last week, on the pretext of Fastweb having an insufficiently diversified set of suppliers. Huawei and Fastweb have been working together on 5G for some time.

We’re not sure what proportion of Fastweb’s 5G deals to-date have been awarded to Huawei, but it’s unusual for governments to intervene over such matters unless there are already laws in place. The UK government, for example, attempted to cap the proportion of 5G RAN work that can be awarded earlier this year, before it caved in to diplomatic pressure from the US to ban it entirely.

The Italian government has yet to announce a specific policy on Chinese vendor involvement in its 5G networks, so this move comes somewhat out of the blue. As Reuters notes, however, U.S. Secretary of State Mike Pompeo has spent most of this year touring Europe to persuade everyone to join its anti-Huawei crusade.

Chinese media have attempted to downplay the move, but it’s hard to see this as anything other than the first step of an official Italian government policy designed to restrict or completely band Huawei involvement in its 5G networks. If this was just about plurality of supply, then why haven’t we seen equivalent vetoes concerning Ericsson and Nokia?

Meanwhile Pompeo’s incessant touring seems to be paying dividends further east, with AP reporting Bulgaria, Kosovo and North Macedonia have joined the US ‘clean network’ initiative. This is just another front of the same offensive to keep Chinese vendors out of as many telecoms networks as possible.

There’s no much else to add on the latter story, other than to reflect on the effectiveness of the initiative on the whole. The EU seems to be hiding from the diplomatic consequences of adopting a formal position on China and 5G by leaving that decision to individual members. This is playing into the hands of the US, however, which seems to be picking them off one by one.