UAE urged to replace Huawei’s 5G to secure U.S. F-35 jets deal

Under U.S. pretense that the Chinese telecom vendor Huawei could expose the Gulf to national security threats, United Arab Emirates (UAE) telco firms are urged by U.S. Lockheed Martin’s F-35 jets and drones’ sales deal to push Huawei from its 5G infrastructure contracts.

The UAE has always held a fierce stance concerning its strong mobile market gripped by its leading telco operators, Etisalat and du, both of which are state-owned and controlled.

Early 2021, telco companies, alongside the government, revealed plans to attract a higher foreign investment rate into both firms, with foreign ownership reaching 49 percent.

While China globally takes the lead with its 5G penetration rate – with anticipation to be adopted as input parameter for business viability, traffic estimation, and network planning for the network’s infrastructure – the U.S. is expected to follow suit as it is currently maintaining its focus on becoming the West’s new driving force in the 5G race of power. At the same time, UAE’s Etisalat and du are currently consummating plans to deliver its users with national coverage by harnessing LTE networks power.

The telco companies’ move created the foundation needed to further grow the mobile broadband sector and initiated a strong development in keeping an open mind and accepting content and applications, especially commercial transactions conducted electronically by mobile phones, also known as m-commerce.

In a bid to promote the fifth generation’s capacity in the Emirates in the upcoming years, and by default sustaining data demand, the government gave the green light for Global System for Mobile Communications (GSM) networks’ termination and all its networks to be utilized and implemented to help optimize 5G strengths by the end of 2022.

GSM is a renowned mobile phone network that helps switch between phones on GSM networks with information stored on a SIM card. It is globally adopted by most countries, except the U.S. who mainly uses Code Division Multiple Access (CDMA) – a type of multiplexing that facilitates multiple signals to occupy one transmission channel to optimize the use of available bandwidth.

In the UAE, Fiber-Optic internet is hastily subjugating DSL in the field of fixed-broadband networks, which plays a massive role in empowering e-commerce, and therefore complementing the government’s plans to transition its economy from a purely oil-reliant economy to a digital-based one.

So, what will be the Emirates’ move to rely on Fiber-optic internet means for its collaboration with Chinese telecom vendor Huawei seeing that it is considered one of the U.S.’ biggest allies in the region.

In a September interview with Gulf News, President of Huawei Middle East, Charles Yang unveiled the telecom vendor’s 5G and cloud computing plans for the region despite U.S. imposed actions.

When asked about the UAE’s 5G infrastructure contracts and whether Huawei sees itself in a powerful position bestowing it with an active role in the Gulf’s recently emerging 5G space, Yang said the following:

“The GCC – Gulf Cooperation Council – in particular, was among the global frontrunners in embracing 5G. Huawei was part of many of the first-phase 5G commercial rollouts in the Middle East and has continued to expand those networks with leading telecom operators. In particular, we see an opportunity to advance the 5G value proposition for business. The real value of 5G transcends the telecoms industry and has transformative implications for the economy as a whole.”

This means that Huawei was eagerly anticipating what could have been its deal of the century for 5G networks with the UAE. However, the Emirates’ move to give power to its local telco vendors will most definitely jeopardize any future 5G contracts the GCC might have with the Chinese vendor. 

While the UAE’s maneuver to potentially remove Huawei’s 5G contract from its network, was not an unanticipated move; one that is forced upon by the Biden Administration, who gave the Emirates an ultimatum to choose between China’s 5G network infrastructure or the previously approved-upon F-35 jets deal.

In January, the UAE signed a $23 billion deal with the U.S. to buy 50 F-35 jets and an estimate of 18 armed drones before President Joe Biden took office. Now, the U.S. is leveraging this deal to convince the Emirates to isolate Huawei equipment from its networks for the upcoming four years before acquiring the jets and drones in 2026 and 2027.

In addition to the four-years’ extension given by the U.S., the UAE demanded an undisclosed time period on the given duration to lengthen its ability to find alternative and affordable solutions to substitute Huawei’s 5G infrastructure. Some suggested substitutes were Samsung Electronics Co., Ericsson AB, or Nokia.

BuddeComm reported that due to the aftermaths of COVID-19 and its residues on the telecoms sectors, chances are any retrieval in the industry in the upcoming year will be driven by network operators and mobile device production to strengthen its current infrastructure – which will not happen without difficulty.

Moreover, a thick shroud of vagueness follows the UAE in determining and predicting future and long-term impacts resulting from U.S. pressure on its telco firms to replace Huawei as its lead 5G network provider.

The only certainty the Emirates currently has is re-farming the 5G spectrum from different vendors to secure its Lockheed Martin F-35 jets and drones’ sales with the U.S. while preserving its future 5G infrastructure for its digital transformation plan in upcoming years.

The vitality of the UAE’s role is critical to the Middle East’s growth and digital development, alongside its alliance with the U.S. However, Huawei has always been the Gulf’s partner company in extending 5G network deals in the region, specifically the collaboration between the Chinese vendor and Etisalat in building the needed telecommunication architecture for future projects, such as Dubai Expo 2020.

The stakes have never been higher for the UAE, as it is stuck in the crossfire between the world’s most dominant powerhouses who are trying to prove and demonstrate their supremacy. Eventually, the Emirates will have to take a stance and choose a side as to which division suits it: a military stance with the U.S. by securing the F-35 jets deal or a telco stance by preserving Huawei’s 5G contract.