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Hungary has no evidence of Huawei threat, plans rapid 5G rollout: minister

By Gergely Szakacs
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Hungary has no evidence of Huawei threat, plans rapid 5G rollout: minister

Hungarian Innovation and Technology Minister Laszlo Palkovics sits for an interview in his office in Budapest

By Gergely Szakacs

BUDAPEST (Reuters) - Hungary has no evidence that equipment from Chinese telecoms giant Huawei poses a security threat, a government minister said on Thursday, adding that Budapest was mulling incentives to accelerate the rollout of a high-speed 5G network.

The United States and some of its Western allies believe Huawei Technologies' equipment could be used for espionage, and see its expansion into central Europe as a way to gain a foothold in the European market. Huawei denies the accusations.

Washington is concerned in particular about the expansion of Huawei, the world's biggest maker of telecoms equipment, in Hungary and Poland.

Budapest has so far shrugged off the security concerns and on Thursday Innovation and Technology Minister Laszlo Palkovics told Reuters that Hungary had yet to receive any evidence beyond what he called accusations leveled at Huawei.

"We have taken a rather pragmatic stance, the same, in fact, as Germany," Palkovics said. "It has not been proven that Huawei's technology would pose any risk to Hungary, as we have seen no (data) to support that."

"Until it is proven that Huawei, or Cisco or any other technology poses any threat to our community, that is Hungary, NATO or the European Union, we will handle Huawei's technology as any other technology," he added.

Palkovics' comments follow the Hungarian telecoms regulator NMHH's publication this week of the draft documentation for the sale of more than 400 megahertz of 5G spectrum later this year. This fires the starting gun on the rollout of a high-speed wireless network expected to serve self-driving cars and real-time communication between machines.

He said the country expected the auction to raise about 70 billion forints ($244.67 million).

Huawei employs around 2,000 people in Hungary, where it has invested $1.2 billion since 2005 according to company figures. Its European Supply Centre near Budapest, launched in 2009, is Huawei's biggest production base outside China, the group says.

Prime Minister Viktor Orban's government has strengthened business ties with Beijing over the past years.


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Acknowledging that Hungary's technological acumen lagged that of its U.S. and German allies, Palkovics said Budapest was studying the example of Germany where he said an assessment system was developed to precisely identify possible security threats. Germany is Hungary's biggest foreign investor.

"I am positive, that if it were to become obvious that (there is a security risk), Hungary is a member of NATO, which entails a spate of commitments, which we will follow, but so far, there has been no information to support that," he said.

Deutsche Telekom unit Magyar Telekom has installed Huawei and Cisco Systems Inc equipment at a 5G test base in western Hungary.

Asked whether Huawei could participate without restrictions in the rollout of Hungary's 5G network, Palkovics said:

"Once other, technologically more advanced countries launch the rollout that way, we will follow suit. If they do not, we will not either."

Palkovics said the government was planning talks with telecoms companies and other players in the sector on ways to facilitate a faster rollout of 5G.

The minister said he had met representatives of Germany's Siemens and car maker BMW, which plans to build a 1 billion euro factory in eastern Hungary, for talks on possible uses of 5G technology.

"In Germany, Siemens and BMW have proposed that there should be an available spectrum for in-house applications. These companies are also present in Hungary and they have proposed the same," he said, adding that these frequencies would be allotted in a second stage of the Hungarian 5G tender.


(Reporting by Gergely Szakacs; editing by Emelia Sithole-Matarise)