Trump set to raise the stakes over Huawei during UK visit

US President Trump will reportedly threaten to withdraw some intelligence cooperation with the UK unless it bans Huawei, when he visits.

This insight into Trump’s intentions comes courtesy of the FT, which says it has been chatting to people involved in organising the visit. Those people told it that the Prez will definitely raise the matter when he’s over here and he’s not happy about the UK’s current refusal to do what it’s told by the US and ban Huawei outright from its 5G network.

“The president is preparing to repeat the message that Chinese involvement in 5G could pose significant challenges for US-UK intelligence co-operation. He is prepared to go hard on this issue,” an unnamed insider told the FT. Trump has always been a ‘go hard or go home’ kind of guy, so it doesn’t really come as a great surprise that he intends to persist with this approach when he’s over here.

Any awkwardness between Trump and out-going UK PM May will be significantly amplified by the leak, a month ago, that the government was planning to go US advice and let Huawei be involved in UK 5G to some extent. This was so embarrassing to May that she sacked her own Secretary of Defence on suspicion of being the leaker – an allegation he emphatically denied.

No more surprising than the FT story is the revelation from AFP that Huawei has long been the recipient of generous state assistance from China. Huawei has apparently received hundreds of millions of dollar in grants, been given land at a discount and even cheap loans to use as incentives for customers to sign on the dotted line.

Apparently Huawei annual reports reveal $1.6 billion in back-handers from the Chinese government over the past 10 year, at least half of which don’t seem to have come with any strings attached. The export credit side of things is supposed to be regulated under international rules, but we’re told that China has refused to abide by them.

While none of this behaviour comes as a big shock, it does feed into the broader US narrative of China cheating at global trade. Once more Huawei is being used as a proxy in this dispute and it’s hard to see what it can do about it. It’s no secret that China has done a lot to support internal champions, but it’s hardly alone in that respect.

So this particular side of the trade dispute comes down to degree. The US and Europe will claim their protectionism is within international trade rules while China’s isn’t. It could be that even the security concerns that have been the main stick to beat Huawei, and by extension the UK, with are just a proxy for this broader drive to force China to abide by international rules and that they won’t go away until it does.