Key German Leaders to Decide on Huawei and ZTE Equipment Ban
According to sources familiar with the matter, top German officials including Chancellor Olaf Scholz are set to hold a meeting to decide whether to restrict telecom operators from using Chinese equipment from companies like Huawei and ZTE.
Sources revealed to Reuters that Scholz, German Interior Minister Nancy Faeser, and Transport Minister Volker Wissing will soon convene to discuss setting stricter security requirements for 5G mobile networks.
Last year, the German Interior Ministry proposed reforms for the 5G network, citing an overreliance on Chinese suppliers like Huawei and ZTE. They aim to gradually phase out key components from these Chinese companies from the 5G network by 2026.
Germany has been reassessing its relationship with China, viewing the nation as both a cooperative partner and a systemic competitor.
During the Trump administration, the United States initiated the Clean Network program, urging Western allies to remove “untrustworthy” Chinese telecom operators, applications, and cloud services from their networks and devices. At that time, Germany was reluctant to ban Huawei from participating in domestic 5G network construction, stating a lack of evidence indicating security concerns linked to Chinese equipment.
However, following the COVID-19 pandemic and the Russia-Ukraine conflict, Germany has realized the risks of overreliance on supply chains from China and Russia. Additionally, China’s violations of human rights in Hong Kong, threats to Taiwan’s democratic system, and support for Russia have increased Germany’s desire to reduce strategic dependence on China.
China has been a core market for some of Germany’s most renowned companies in the past. Nevertheless, this situation may be evolving.
According to official German statistics, in the first quarter of this year, the United States surpassed China to become Germany’s most important trading partner.
Data shows that from January to March this year, the total trade volume between Germany and the United States reached 630 billion euros (about 680 billion US dollars), slightly higher than the amount with China, which was just under 600 billion euros.
From 2016 to 2023, China was Germany’s top trading partner for 8 consecutive years. However, in 2023, trade between China and Germany significantly declined, dropping by 15.5% compared to the previous year, with the trade balance narrowly favoring the US-Germany partnership by a few billion euros.
Juergen Matthes from the Institute of Economic Research (IW) pointed out, “The performance of the Chinese economy has turned out to be worse than anticipated by many, while the US economy has exceeded expectations, likely contributing to this shift.”
The current share of German exports to the US stands at around 10%. Matthes mentioned that China’s share has now decreased to less than 6%.
He added, “Due to the evident global economic headwinds facing the German economic model, coupled with geopolitical considerations, Germany seems to be repositioning itself: moving away from systemic competitor China (CCP) towards its transatlantic partner, the US.”