EU Warns Chinese 5G Role In Vietnam May Deter Investors
A senior European Union official has warned that the involvement of Chinese firms in Vietnam’s 5G network rollout could discourage foreign investment. The concern follows recent decisions by Vietnamese state owned telecom operators to award contracts to Chinese companies Huawei and ZTE.
Although European firms Ericsson and Nokia continue to develop the core of Vietnam’s 5G infrastructure, the inclusion of Chinese vendors marks a notable shift. Previously, Vietnam had shown caution towards Chinese participation in sensitive technology sectors. However, this change has raised fresh concerns among Western policymakers.
Security Concerns Surround Strategic Networks
European Commissioner for International Partnerships Jozef Sikela urged Vietnam to remain cautious when choosing partners in strategic industries. He emphasised that 5G networks carry significant importance due to their ability to handle vast amounts of data and enable system control.
Moreover, Sikela stated that concerns over data security could influence investor decisions. If companies doubt the safety of their information, they may reconsider investing in the country. Consequently, even theoretical risks could have real economic implications.
At the same time, Vietnam’s foreign ministry and the Chinese embassy in Hanoi have not responded to requests for comment. Meanwhile, Huawei and ZTE have rejected the allegations, describing them as baseless and criticising restrictions as unfair.
Investment Risks Amid Growing Tech Competition
Vietnam remains a key manufacturing hub that hosts major international companies. Its long standing economic growth depends heavily on continued foreign investment. Therefore, any uncertainty surrounding digital infrastructure could affect investor confidence.
In addition, the European Union and its member states have announced new investments in Vietnam’s transport and energy sectors. Despite this, officials continue to highlight the importance of secure and trusted telecom networks.
Furthermore, Sikela acknowledged that concerns about network security remain theoretical at this stage. He also noted that several European countries had previously allowed Chinese telecom vendors before tightening restrictions.
However, Chinese telecom firms face bans in multiple European countries and the United States due to national security concerns. In contrast, Vietnamese officials have defended the use of Chinese equipment, citing its reliability and lower cost. They have also downplayed potential risks while considering further contracts with Chinese providers.
As global competition in advanced technologies intensifies, decisions about telecom infrastructure are becoming increasingly critical. Countries must balance cost efficiency with security considerations, especially as digital networks play a central role in economic development.
With inputs from Reuters
