Will the EU Go to War with China Over Telecommunications Equipment?

Market Insight

Late last month, the Financial Times reported that the European Commission has been collecting evidence to accuse Chinese telecommunications equipment vendors of benefitting from illegal government subsidies and “dumping” products in the EU below cost. Many people in the telecommunications industry believe that Huawei and ZTE receive support from the Chinese government in many different ways, such as with lucrative contracts from the government (and government-linked companies), protection from foreign competitors in the domestic market, low-cost (or no-cost) government financing, and even direct subsidies. However, no one wants to say this out loud for fear of Chinese government retaliation.

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