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Portugal stands firm over Huawei despite US pressure

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The Portuguese Prime Minister António Costa said Portugal would not introduce “protectionist measures” regarding Chinese investments over the introduction of Huawei equipment for 5 and 5G networks.

The assertion comes in the face of considerable pressure from the United States of America, a NATO member and close ally of Portugal as the country’s Number 5 export market worldwide and its biggest trading partner outside the EU with exports worth €4.66Bn in 2017 – an increase of 8.6% in five years.
Costa said that other countries like the United Kingdom and Germany had accepted the supply of Huawei equipment for 5 and 5G networks after concerns were raised by the European Commission to do with the regulation and supervision of Chinese investors in decisive sectors like energy, banking and telecommunications.
Chinese investment in Portugal has topped €9Bn over the past few years with strong investment from Chinese State financed companies.
And the US Ambassador to Portugal, George E. Glass made it clear on Thursday evening at the annual AmCham Tributes organised by the American Chamber of Commerce in Portugal that the US is “concerned” about Chinese investment in Portugal and criticised the Chinese State model whereby companies owned by the Chinese State invest in other countries like Portugal as a means to exercise so-called soft power.
In various interviews the ambassador has said that Portugal is one of the gateways to Europe in the belt and road initiative (a Chinese infrastructure project across the world where they have invested around a $ trillion and voiced “concern” rather than “worry”.
Many wealthy Chinese have moved to Portugal since 2012 (there is a Chinese community numbering 30,000) — taking advantage of the Golden Visa scheme that allows non-EU foreign individuals to buy property valued at €500,000 in return for residency and access to the Schengen area. However, Chinese individual investment has wained as the Chinese are channelled to more lucrative and competitive residency by investment scheme like the Cyprus programme.
Chinese state-sponsored investments in Portugal include a 23% stake in the country’s electricity company EDP from China Three Gorges made in 2011 and a 49% stake in EDP Renewables for €359 million in 2012.
China’s State Grid also bought a 25% holding in electricity network REN for €387 million in 2012 while bank Millennium bcp is now 27% owned by China’s Fosun International in a €1.2Bn deal.
Fosun also laid out €1Bn for Portugal’s largest listed insurance company Fidelidade while private health care provider Luz Saude was snapped up for €460 million in 2014.
António Costa said that the previous centre-right government under Pedro Passos Coelho had “attracted important Chinese investments to Portugal” and hoped, now in opposition, that they were not now “demonising Chinese investment.”
Ambassador George Glass raised concerns at the AmCham Tributes that Chinese investments such as Huawei risked compromising security.
Antonio Costa, who was to be the main speaker at the AmCham gala dinner, but tellingly cancelled at the last moment, said that he would not accept, under the pretext of a compromise in security, that protectionist mechanisms should be introduced that would impede contract conditions from countries that have to contract in order to modernise technologically.


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