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October 24, 2019

Will the Bundestag stop Merkel's 5G unilateralism?

We noted a couple of editorials in German newspapers over the last few days calling on the Bundestag to resist Angela Merkel's decision to override security concerns over Huawei's 5G bid. The most important, in Handelsblatt, is co-authored by Norbert Rottgen, the CDU chairman of the Bundestag's foreign affairs committee. We do not want to overestimate his personal influence, but we think the power of the arguments should not be underestimated.

The reason Merkel took the decision was pressure from traditional companies like VW that are doing business in China and that fear reprisals. Rottgen and coauthors point out that the security catalogue of the German government does not appreciate the strategic importance of the 5G network. 5G will emerge as the digital nerve centre of the economy - the infrastructure needed for electric cars, for example. Under Chinese law, Huawei is legally required to co-operate with the Communist Party. It is insufficient for the German government to rely on promises made by Huawei. In order to guarantee supplies, Germany must reduce its current dependence on a single supplier. What Germany and the EU should be doing instead is strengthening the position of the two European suppliers - Ericsson and Nokia - which might otherwise not be able to compete at all. The authors argue that the decision is so far-reaching that it should be made by the Bundestag, not by Merkel. 

Writing in FAZ, two authors from foreign policy think-tanks arrive at an even starker conclusion. They argue that, in the case of a geopolitical conflict with China, Huawei can be expected to act in the Chinese national interest. Merkel has thus damaged Germany security interests, and ultimately weakened its economy and its diplomacy. What is particularly galling about the decision is that the EU has two of the world's three 5G suppliers.

Wolfgang Munchau writes: what we are seeing here is yet another consequence of an export-oriented economic model. Export surpluses create dependencies. Its dependence on surpluses is the main reason why Germany has no tradition of strategic foreign policy thinking because strategies would sometimes over-ride short-term commercial interests. An EU-level technology and security strategy would clearly harm some exporters. If you want to fix the lack of a strategy, this is where you need to start: reduce the surpluses.

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