US issues fresh Huawei warning after UK approves £1 billion R&D lab


A computer-generated design of Huawei’s new chip research plant in Cambridge.


The U.S. has issued a fresh Huawei warning to the U.K. after a local authority approved the Chinese tech giant’s £1 billion ($1.24 billion) chip research and manufacturing facility in Cambridgeshire. 

South Cambridgeshire district councillors voted nine to one in favor of the facility on Thursday. Less than 24 hours after the green light, the U.S. State Department repeated claims that Huawei poses a national security threat, claiming it is linked to the Chinese Communist Party (CCP).

“We urge all countries, particularly allies and partners like the United Kingdom, to carefully assess the long-term impact of allowing untrusted companies like Huawei access to sensitive information,” the U.S. State Department said in a statement shared with CNBC.

The department claimed that the CCP acquires technology and intellectual property through “licit and illicit means, through collaboration and through deception, and by investment, joint research, and outright theft.”

The fact that Huawei is “subject to an authoritarian government” means trust “cannot exist” the department said.

“We believe countries need to be able to trust that partners will not threaten national security, privacy, intellectual property, or human rights,” it claimed. “Trust cannot exist where a company such as Huawei is subject to an authoritarian government, like the PRC, that lacks an independent judiciary or rule of law that would effectively prohibit the misuse of data.”

Experts say that Huawei would have no choice but to hand over network data to Beijing if it is requested due to Chinese espionage and national security laws. But Huawei has repeatedly denied accusations that it passes data to Beijing and insists it’s independent from government.

Huawei’s big plans

Huawei hopes to employ 300 to 400 people at the lab and use it to develop and manufacture optoelectronic chips and other equipment that can speed up data transmission over the internet.

Within minutes of the council vote, Huawei told journalists it was going to spend £1 billion on the R&D facility over the next three years, up from the previously reported £400 million.

The Shenzhen-headquartered company bought the 500-acre plot – located in the tiny village of Sawston, Cambridgeshire – from stationary provider Spicers for £37.5 million in 2018. The plot is close to the scenic River Cam and seven miles from the iconic spires of the University of Cambridge.

The 50,000 square foot R&D building will occupy approximately 10% of the rural plot. Over time, however, Huawei hopes to build a large campus there in the same way that Google has built a large campus in London’s King’s Cross.

Tense times

Huawei’s sizeable investment comes as Britain weighs up whether Huawei’s telecoms equipment should be used in the nation’s 5G networks.

Last month, the U.K.’s National Cyber Security Center (NCSC) launched an emergency review into the matter and the U.K. has drawn up plans to strip Huawei equipment from Britain’s 5G networks within three years.

The NCSC’s review was announced just days after the U.S. introduced new export controls on Huawei designed to restrict the company’s access to chips made with U.S. equipment. 

The U.S. escalated its ongoing row with Huawei this week when the Trump administration published a list of 20 leading Chinese firms that are allegedly owned or controlled by the Chinese military. The list includes Huawei and it paves the way for new U.S. financial sanctions.

Earlier this month, former Google CEO Eric Schmidt decided to get involved in the debate, telling the BBC that there’s “no question Huawei has engaged in some practices that are not acceptable in national security.”

Tony Blair, Britain’s former prime minister, said the U.K. will ultimately have to side with the U.S. over Huawei.

“I think we do need to make a call and I think it has got to be pro-U.S. in the end,” Blair said when asked about Huawei at a Reuters Newsmaker event.

“It is very hard for us not to be with the U.S. on anything that touches U.S. security.”

CNBC’s Ryan Browne contributed to this article.


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