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U.K. Says Huawei Decision Won’t Affect U.S. Intelligence Sharing

Alex Morales

(Bloomberg) -- The U.K.’s decision to allow China’s Huawei Technologies Co. to be involved in building its 5G telecom networks won’t affect trans-Atlantic intelligence sharing, despite U.S. threats to the contrary, Digital Secretary Nicky Morgan said.

Britain gave the green light for Huawei kit to be used in non-sensitive parts of its new networks Tuesday, ending a protracted debate. In the run-up to the decision, there was a steady drumbeat of warnings from President Donald Trump’s administration that the U.S. may hold back secret intelligence if Prime Minster Boris Johnson pressed ahead with giving the company a role.

Asked in a Bloomberg Television interview whether she’d had assurances before the decision to include Huawei -- deemed a high-risk vendor, Morgan said: “Yes, we’ve obviously had a lot of advice from our various security agencies about that,” before adding: “There is no reason why the decision should or would affect our ability to share classified data with the U.S. or our allies.”

U.S. Secretary of State Michael Pompeo, who was among officials to warn Britain ahead of the decision, is in London on Wednesday and is likely to raise the issue in meetings with ministers. A slew of U.S. congressional figures have already criticized the U.K.’s position and Johnson and Trump spoke about the issue on Tuesday evening, with the premier underlining the need for Western allies to work together to break the market dominance of a small number of companies.

“I know that there are very strong feelings in the U.S. particularly in relation to China, but there are many, many areas where we cooperate very fully in lots of different ways with the U.S., and I think that special relationship will remain,” Morgan said on Wednesday. “We would like eventually to have more providers to work with the U.S. and other countries creating or supporting companies to have this capability,” she said, “so we don’t have to rely on high-risk vendors in the future.”

U.S. Disappointed as Johnson Gives Huawei Partial 5G Role (1)

With Ericsson AB and Nokia Oyj the only alternatives, Huawei’s involvement is needed to ensure the networks are resilient because “we would never want to rely just on two vendors,” Morgan said.

“That’s why a third provider is necessary,” she said. “At the moment it’s deemed to be Huawei, it’s a high risk vendor, but hopefully the market will respond to calls for more diversification so we will have a better choice in the future.”

Morgan, who earlier told LBC Radio that the National Security Council decision on Huawei was “unanimous,” pointed out that the U.K. has monitored the Chinese company’s involvement in U.K. telecom networks for years, and is “clear-eyed” about the risk. That, she said, informed the decision to keep the company out of core networks and sensitive locations and limit them to a 35% share of the market.

“We know more about Huawei, the way they operate, their capabilities, than any other country, which means we are confident we can mitigate the risk,” Morgan said. “We would not make the decision if we thought that it compromised national security at all.”

--With assistance from Anna Edwards and Matthew Miller.

To contact the reporter on this story: Alex Morales in London at amorales2@bloomberg.net

To contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Giles Turner, Thomas Penny

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