EXCLUSIVE-Huawei, ZTE seal 5G deals in Vietnam after US tariffs, ties with China warm

By Francesco Guarascio

HANOI (Reuters) – China’s major telecommunications firms Huawei and ZTE have won a series of contracts to supply 5G equipment to Vietnam this year, another sign of Hanoi’s strong ties with Beijing, raising concerns among Western officials, seven people with direct knowledge of the situation told Reuters.

For years, Vietnam was seen as reluctant to use Chinese technology in sensitive infrastructure, but in recent months it has embraced Chinese tech companies as sometimes frosty relations with its northern neighbor have warmed while relations with Washington have cooled due to tariffs on Vietnamese goods.

While Sweden’s Ericsson and Finland’s Nokia secured contracts for Vietnam’s 5G core infrastructure, US chipmaker Qualcomm provided network equipment, Chinese companies have started winning smaller tenders with state-owned operators, as yet unreported public procurement data shows.

A consortium including Huawei was awarded a $23 million contract for 5G equipment in April, just weeks after the White House announced tariffs on Vietnamese goods. ZTE has won at least two contracts, one last week, for more than $20 million for 5G antennas. The first public disclosure agreement came in September, a month after the U.S. tariffs took effect.

Reuters could not establish whether the timing of these wins was linked to US tariffs, but the deals raised concerns among Western officials.

The exclusion of Chinese contractors from Vietnam’s digital infrastructure, including undersea fiber-optic cables, has long been identified by Washington as a key condition for support for advanced technologies.

Huawei and ZTE have been banned from US telecom networks as an “unacceptable risk” to national security. Sweden and other European countries have similar restrictions.

Ericsson declined to comment on the Chinese companies, but said it was “fully committed to supporting its customers in Vietnam.”

Huawei, ZTE, Nokia, Qualcomm, the US Embassy in Vietnam, the Embassy of China, Sweden’s Ministry of Foreign Affairs or Vietnam’s Ministry of Technology responded to requests for comment.

Vietnam-China warm relations

The non-aligned Southeast Asian nation is an important battleground in the global influence race. Its proximity to China has made it a major industrial hub for multinationals such as Apple, Samsung and Nike, which rely on Chinese components and Western consumers.

Under Western pressure, Vietnam has long taken a “wait-and-see approach” to Chinese technology, said Nguyen Hong, a supply chain expert at RMIT University Vietnam. But “Vietnam has its own priorities,” he added, adding that a new deal could encourage deeper economic integration with China.