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October 15, 2019

Germany chooses Huawei for 5G

Handelsblatt has the story that Angela Merkel has personally intervened in favour of Huawei in the choice of suppliers for Germany’s 5G network. Merkel did so because she feared a break with China that Germany can ill afford. 

We are not surprised. The fall in Chinese imports is one of the main sources for the slowdown in German manufacturing output. If China started to retaliate against German firms, the damage to the German economy could be substantial. Germany also left itself no technological alternatives. Several German mobile operators already use Huawei equipment. It is the only technology on the market that allows Germany a nationwide 5G coverage. 

Handelsblatt obtained the latest version of the security catalogue of the federal network agency, which oversees the 5G network bidding process. Huawei was listed among the companies eligible to supply components. The final decision is due in the next few days. The document no longer contains the clause that Huawei is barred from supplying components.

The paper notes that it is highly unusual for the chancellor to get involved in an administrative decisions of that kind. 

We also note that the decision is quite symbolic of the state of EU diplomacy. There was no coordination at EU level. The priority was to safeguard access of German companies to the Chinese market. This means that EU member states will likely all end up with their own disparate policies towards China.

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October 15, 2019

US and EU respond to Turkey - too little, too late

As violence escalates between Turkish and Kurdish forces in Syria and Russia moves into the political vacuum, we have the first round of diplomatic reactions. Donald Trump is calling for a ceasefire and has signed off on sanctions against Turkish ministers, a 50% tariff on stee,l and the immediate stop of US-Turkey trade talks. The official line is now that the US could not stop Turkey so it was important to get its own troops out of the way. Trump reinvents himself as peace mediator and saviour of US troops, though it is not clear that this will in any way compensate for his extraordinary foreign policy blunder. Analysts warn that the US response is too little and too late. EU foreign ministers, meanwhile, condemned Turkey's operation in Syria and the EU will be coordinating with member states to stop exporting weapons to Turkey. There is no EU arms embargo, which would have required a longer procedure according to Heiko Maas, the German foreign minister. This is a first step, that may be followed by others. 

UN sources already say that about 70,000 people have been displaced by the Turkish invasion. The incursion into Syria also set free captured Isis fighters, according to the Pentagon. The Kurds now say they are officially ready to partner with Bashar al-Assad and Russia.

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