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Huawei’s security drive could end up costing “much more” than $2bn, says exec

Huawei’s cyber security drive could cost the Chinese tech giant significantly more than the $2bn (£1.5bn) it has already committed to the project, the firm’s Europe chief revealed today (25 February).

Speaking to reporters at Mobile World Congress in Barcelona this morning, Vincent Pang said that the funding pledge covered only the initial period of work and that the total cost of the five-year transformation could be “much more than $2bn”.

The revelation came after officials at the National Cyber Security Centre, which was responsible for instigating the security drive, warned last week that they had not yet seen a “credible plan” for the transformation project.

The company has since said it would publish its plan in the first half of this year. As NS Tech reported earlier this month, Eric Xu – one of Huawei’s three rotating chairmen – is undertaking a review of the required work that could conclude as soon as next month.

Pang’s comments also came in the wake of a speech delivered in Singapore earlier today by Jeremy Fleming – the head of GCHQ – that raised concerns about the rise of Chinese tech. “The strategic challenge of China’s place in the era of globalised technology is much bigger than just one telecommunications equipment company,” he told an audience in Singapore.

Pressed on whether Huawei had made mistakes in recent years, Pang admitted that the company had “underestimated a little bit the level of this kind of challenge”, referring to the recent US-led crackdown on its telecoms equipment.

“In the last 15 years we have paid a lot of attention to the customers and the technology, but we could do more to be more transparent, to communicate with the public, the government and the media,” he told European media. “I think this is the part we need to improve, especially [given the level of attention we are receiving at the moment].

“We will do more to make this company more transparent,” he added. “We will think about what we can do to make it it easier to understand who is Huawei and what’s the mission and vision of this company in the next 20 years.”

Pang will now be tasked with carrying out that plan. He revealed during the press conference that in addition to his duties as the head of Huawei in Europe, he would also be taking on a new role as global media chief, signalling the importance of the company’s relationship with European nations.

On Thursday, Donald Trump posted a tweet which marked a softening of his stance on Huawei. “I want the United States to win [in 5G] through competition, not by blocking out currently more advanced technologies,” he wrote.

Few had anticipated such an intervention. The Trump administration has ratcheted up its rhetoric against Huawei in recent weeks and had been expected to issue an executive order restricting the use of the company’s kit in the US ahead of Mobile World Congress.

However Trump’s latest gambit, which has been seen as a ploy to break the trade impasse with China, won’t entirely reassure Huawei. Just hours before, Mike Pompeo – Trump’s secretary of state – took to Fox News to warn that the US will sever ties with allies if they carry on using the firm’s telecoms equipment.

It has been reported that US officials are using MWC as an opportunity to discourage prospective Huawei customers from buying their technology. Pang said US officials had turned down Huawei’s requests for a meeting at the conference.