Huawei To Invest £1.3bn In UK

Chinese networking giant Huawei has confirmed a £1.3 billion investment in the UK, pledging to add to its workforce and spend on research and development.

Huawei CEO Ren Zhengfei met with Prime Minister David Cameron yesterday, pledging £650 million for its operations in the country and another £650 million in procurement over the next five years, meaning other British businesses will likely benefit. The move is designed to counter suggestions that Huawei is having trouble selling to the UK government because of its connections in China.

The firm has plans to increase its workforce to over 1,500 by 2017, up from the 800 it currently employs. Huawei also said it would set up a number of “global centres of technical and financial excellence”.

Chinese relations

“The investment announced by Huawei today demonstrates once again that the UK is open for business. I welcome this and I want to see more companies invest in the UK as we work to achieve sustainable and balanced growth within our economy,” Cameron said.

“The British government values the important relationship with China, both countries have much to offer each other and the business environment we are creating in the UK allows us to maximise this potential.”

Zhengfei added: “The UK is one of the most important European markets in which Huawei has invested.  Over the past eleven years we have found its Government to be transparent, efficient and practical.  The UK is an open market, which welcomes overseas investment.”

Huawei has been busy improving its image in the UK, where some have been wary of the country’s connections to the People’s Liberation Army of China, and the Chinese government.

Some have raised fears the networking kit could contain backdoors, or kill switches, that would allow China to eavesdrop on communications or shut down equipment. But Huawei has always denied such allegations.

Zhengfei did work as an engineer in the PLA, reportedly in the IT research division, but he did not hold military rank, according to Huawei.

It has scored some major deals in the UK, one of the biggest with EE. Huawei is supplying a significant chunk of the gear needed to run EE’s 4G network, which was officially launched yesterday.

Huawei also runs a Cyber Security Evaluation Centre in the UK, which was established in late 2010 and is being used to test the security of network products of Huawei and its partners.

It has employed a number of former British government employees over the last two years, many of whom work at the centre, including some from GCHQ. The biggest name signing was John Suffolk, former government CIO, who now runs global security for the company.

However, a source close to the company recently told TechWeekEurope Huawei was continuing to find it difficult to sell to the UK government because of the vendor’s origins and connections in China.

Elsewhere, Huawei is still finding it hard to gain trust. In Australia it was banned from supplying into a national broadband infrastructure.

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