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Telecoms is centre-stage in potential EU – China trade war

Karel De GuchtJust like everything in China lately, the telecoms networks are expanding. China Mobile will be selecting winners for the their contract to create a huge next-generation wireless network soon and the EU will shortly afterwards launch an incendiary trade case against them.

The project that China Mobile are embarking on is expected to be worth half of the global investment in telecoms next year. The Commissioner of Trade in the EU, Karel De Gucht, is believed to be willing to drop the case as long as EU companies are allowed to be part of the project.

The telecoms debate has opened up and become the number 1 discussion between the territories after closing the case over Chinese made solar-panels last week. The on-going disputes for trade are now coming thick and fast, causing an air of concern that a trade war could erupt.

Mr De Gucht is keen to see the case through before his term as EU Trade Commissioner is over, and is hopeful that the agreements made last week will “set the tone” for future disputes.

At the moment there are a few European companies, such as Nokia, Ericsson and Alcatel-Lucent all keen on being involved in the China Mobile project. However concerns have been raised since De Gucht found solid-evidence that illegal subsidies had changed hands involving some of China’s largest network equipment manufacturers in the past.

The size of the tender is not only vast due to the amount of immediate capital being invested but it is also believed that companies able to tie up relationships now will also have a better chance of winning contracts when the 4G auctions roll out.

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