Ericsson warns of losing China market share amid Huawei spat
Ericsson has warned that it may end up with a lower share of China’s telecoms market following the rollout of 5G due to an ongoing spat over controversial tech firm Huawei.
The telecoms company has been thrown into the middle of a
row between China and Sweden after its home country’s government last year
banned Huawei from its 5G networks due to security concerns.
Huawei has sued to overturn the decision and a ruling is
expected in the coming weeks.
China has also threatened retaliation against Ericsson, with
authorities warning the company’s involvement in 5G networks would depend on
Stockholm changing its stance towards Huawei.
Ericsson today said it had been invited to various tender
processes in China, but that the final outcome remains uncertain.
“It is the company’s current assessment that the risk has
increased that Ericsson will in those tenders be allocated a significantly
lower market share than its current market share,” it said in a statement.
The warning came in an update to investors related to
Ericsson’s issue of a €500m (£430m) unsecured eight-year bond.
Shares in the telecoms company were down more than one per
cent in early trading.
The rising threat of retaliation has prompted Ericsson boss
Borje Ekholm to hit out at Sweden’s decision to ban Huawei and come out in
support of his company’s arch rival.
Aside from telecoms firms, Beijing has also threatened to
retaliate against other Swedish businesses operating in China.
Retail giant H&M has also been locked in a row with the
country amid concerns about the use of forced labour in cotton production in
Xinjiang.
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