US and EU menace Malaysia over Huawei

The Malaysian government has reportedly received separate letters from the US and EU, warning it of negative consequences if it allows Huawei kit in the country’s 5G networks.

We know this thanks to the FT, which got a look at letters sent by US and EU envoys to the Malaysian government. The catalyst for the letters was the decision of the country to review the tender process for its state-backed national 5G network. Ericsson has originally been named sole kit vendor but a new government decided to review the process behind that decision on the grounds that it wasn’t transparent enough.

That obviously opens the door to Huawei once more, which has unsurprisingly been lobbying heavily for a piece of the action, according to the FT. Furthermore, Reuters reported last month (possibly a further cause for this flurry of correspondence) that Malaysia is thinking of creating a second state-run 5G network, for some reason, which would give Huawei yet another bite at the cherry.

“Senior officials in Washington agree with my view that upending the existing model would undermine the competitiveness of new industries, stall 5G growth in Malaysia, and harm Malaysia’s business-friendly image internationally,” wrote Brian McFeeters, the US ambassador to Malaysia. “The US and other countries prioritise a fair and transparent review process and contract sanctity, as does the international business community. Allowing untrusted suppliers in any part of the network also subjects Malaysia’s infrastructure to national security risks.”

Michalis Rokas, Ambassador and head of the EU delegation to Malaysia, more or less echoed that sentiment, noting money invested by the EU in Malaysia and inferring that making the wrong choice of 5G vendor may result in less of that in future.

These come over as not very veiled threats of severe economic and political consequences to Malaysia if it makes the wrong call on its telecoms vendors. Huawei doesn’t seem to have been specifically named but Chinese vendors are clearly the concern. Last month the US even went so far as to pass a law designed to compel its allies not to use Chinese telecoms kit.

Malaysia is presumably the recipient of similar correspondence from China, stressing how much it would be in its interests to allow Chinese vendors into its networks. So, right now, Malaysia can be viewed as the latest proxy in the great geopolitical battle of wills going on between the US and Chinese spheres of influence. Maybe that’s why a second network is being planned – one for each bloc. If so, it’s unlikely that solution will placate the US.

Get the latest news straight to your inbox. Register for the Telecoms.com newsletter here.