A veiled threat from Chinese ambassador to Germany on Huawei

Wu Ken, China’s ambassador to Germany. 

On November 20, China’s ambassador to Germany, Wú Kěn 吴恳, said, per Xinhua: “Unfoundedly excluding Huawei’s involvement from setting up a 5G network in Germany would be blatant discrimination against Chinese companies and would send the wrong signal of protectionism.”

His language has got stronger since then, as you can hear in this German-language video (minute 26), or see reports from the South China Morning Post and Bloomberg (porous paywall):

“If Germany were to take a decision that leads to Huawei’s exclusion from the German market, there will be consequences,” Ambassador Wu Ken said Saturday at a Handelsblatt event. “The Chinese government will not stand idly by.”

Ambassador Wu said at the event Huawei has no legal obligation to provide data to the Chinese government, then reminded the audience that German manufacturers account for a quarter of the 28 million cars sold in China last year.

“Could we say one day that these German cars are no longer safe because we’re in a position to manufacture our own cars?” he said in a video on the newspaper’s website. “No. That is pure protectionism.”

Volkswagen, BMW, and Mercedes-Benz maker Daimler have invested “billions of dollars setting up manufacturing and distribution” in China and it is their biggest market. Thorsten Benner, the director of the Berlin-based think tank Global Public Policy Institute, called Wu’s remarks “a blunt threat.” 

The investment goes both ways. Chinese auto companies are invested in Germany’s car industry. Just yesterday, Reuters reported:

Daimler’s main China joint venture partner BAIC Group has set in motion a plan to double its stake to around 10 percent and win a board seat in the German luxury car maker, as it aims to upstage rival Geely, two sources told Reuters.

State-owned Beijing Automobile Group Co Ltd (BAIC), which already owns a 5 percent shareholding in Daimler, has started buying the German company’s shares from the open market, said the sources who were briefed on the matter.

BAIC is currently Daimler’s third largest shareholder but a stake of 10 percent will make it the biggest shareholder, surpassing its Chinese automaking rival Zhejiang Geely Holding Group which owns 9.69 percent of the German automaker and is seeking to expand its partnership with Daimler in China.

Meanwhile, “Norwegian mobile operator Telenor will reportedly allow both China’s Huawei Technologies and Sweden’s Ericsson to supply equipment for its 5G network,” reports Caixin: 

In addition to its ongoing role in maintaining Telenor’s existing 4G networks, Huawei will play a role equal to Ericsson’s in building its next-generation networks in some parts of Norway over a 4-5 year modernization period, Telenor CEO Sigve Brekke said at a Friday press conference, according to state news agency Xinhua [in Chinese].

Telenor’s announcement echoes that of Telefonica’s German unit, which picked Huawei and Finland’s Nokia Oyj to take equal roles in supplying its network upgrade. The deal is subject to approval by German authorities.