Exclusive-Huawei, ZTE seal 5G deals in Vietnam after US tariffs, as ties with China warm
By Francesco Guarascio
HANOI (Reuters) – China’s leading telecommunications firms Huawei and ZTE have won a number of contracts to supply 5G equipment in Vietnam this year; In another sign that Hanoi’s ties with Beijing are strengthening, the situation has sparked concern among Western officials, seven people with direct knowledge of the situation told Reuters.
For years, Vietnam was seen as reluctant to use Chinese technology in sensitive infrastructure, but in recent months it has embraced Chinese technology companies; because while sometimes frosty relations with its northern neighbor had warmed, ties with Washington had cooled due to tariffs on Vietnamese goods.
Sweden’s Ericsson and Finland’s Nokia have signed contracts for Vietnam’s 5G core infrastructure, while US chipmaker Qualcomm is providing network equipment, while so far undisclosed public procurement data shows Chinese companies are starting to win smaller tenders with state-owned operators.
In April, weeks after the White House announced tariffs on Vietnamese goods, a consortium that included Huawei signed a $23 million contract for 5G equipment. ZTE has won at least two contracts totaling more than $20 million for 5G antennas, including one last week. The first publicly announced deal occurred in September, a month after U.S. tariffs went into effect.
Reuters could not determine whether the timing of those gains was linked to U.S. tariffs, but the deals have raised concerns among Western officials.
The exclusion of Chinese contractors from Vietnam’s digital infrastructure, including undersea fiber optic cables, has long been described by Washington as a key condition for support for advanced technologies.
Huawei and ZTE have been banned from US telecom networks as an “unacceptable risk” to national security. Sweden and other European countries have similar restrictions.
Ericsson declined to comment on the Chinese companies but said it was “fully committed to supporting its customers in Vietnam.”
Huawei, ZTE, Nokia, Qualcomm, the US embassy in Vietnam, the Chinese embassy, the Swedish foreign ministry or the Vietnamese ministry of technology responded to requests for comment.
VIETNAM-CHINA TIES HOT
The non-aligned Southeast Asian nation is a crucial battleground in the competition for global influence. Its proximity to China has made it an important industrial center for multinational companies. AppleSamsung and Nike rely on Chinese components and Western consumers.
Nguyen Hung, a supply chains expert from RMIT University Vietnam, said that under Western pressure, Vietnam had long adopted a “wait-and-see approach” towards Chinese technology. But “Vietnam has its own priorities,” he added, noting that new agreements could encourage deeper economic integration with China.
