China foretells 'devastating consequences' for UK over Huawei ban; cites $20 Bn investment

Last week, the United Kingdom banned Huawei from its 5G telecom network, reversing an earlier decision to allow the Chinese tech giant a limited role in building the country's super-fast wireless infrastructure. CCP's mouthpiece Global Times on Monday, citing scholars said that the move can have a "devastating consequences" on bilateral ties and on Britain's economy.

'Largest recipient of Chinese investment'

Chinese officials have criticized the UK's decision and vowed to take "all necessary measures" to protect Chinese businesses. Though Chinese officials have not announced specific measures, they have stressed that the move has seriously undermined mutual trust and Chinese businesses' confidence in the UK market. 

An article in Global Times says that in a recent interview with the Times, Chinese Ambassador to the UK Liu Xiaoming hinted that Chinese investments into the UK could be at risk as Chinese companies are wary of Huawei's treatment by the UK. 

"In the past 10 years. Chinese investment in the UK increased 20 times…This is a big opportunity for UK," Liu said, noting that with $20 billion Chinese investment, the UK is the largest recipient of Chinese investment in Europe, according to a transcript published by the embassy on Sunday. "I think UK really missed the opportunities." 

The reports state that apart from the massive investment from Beijing, China was the UK's second-largest trading partner after the US in 2018, with two-way trade reaching 68.3 billion pounds ($85.78 billion), according to UK official data.

'UK appears to be keen to join US'

Chinese students also contribute at least 1.7 billion pounds a year to UK universities, according to the UK's National Institute of Economic and Social Research, which warned a trade conflict with China could result in a 90% fall in UK trade and a 0.75% drop in GDP. 

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In what appears like a warning, the mouthpiece, citing various "scholars" and "experts", said that "the risk of long-term damage to bilateral ties and business deals is increased, not just over Huawei but an increasing number of issues, including Hong Kong and the South China Sea, where the UK appears to be keen to join the US and interfere."

READ | China slams US clampdown on Huawei, accuses UK of having no 'autonomy on the issue'

Huawei's statement on 5G ban

Expressing disappointment over UK's decision to ban it from 5G networks, Huawei in a statement issued in Beijing said, "This disappointing decision is bad news for anyone in the UK with a mobile phone. It threatens to move Britain into the digital slow lane, push up bills and deepen the digital divide."

READ | UK asks Japan to help build its 5G wireless networks without Huawei

"Instead of 'levelling up', the government is levelling down and we urge them to reconsider. We remain confident that the new US restrictions would not have affected the resilience or security of the products we supply to the UK," it said. Huawei said its future in the UK has become "politicised". "This is about US trade policy and not security," the statement said.

READ | China to take 'necessary measures' to safeguard its interests after UK's Huawei ban

(With agency inputs)