US and EU sanctions against Huawei have bolstered Sino-Russian cooperation, as the Chinese telecom company looks to be the main player in Russia's 5G build out
Alexander Gabuev / Financial Times : Tweets: @shashj Tweets: Shashank Joshi / @shashj : .@AlexGabuev: '... the Kremlin's rationale for selecting Huawei is straightforward: “We're either going to be bugged by the US or by China, so we need to choose the lesser evil,” as one government insider told me' https://www.ft.com/... https://twitter.com/...
Context & Ripple Effects
US and EU sanctions have cut Huawei off from Western markets and pushed it east: the company had already landed $4B worth of China Mobile network contracts in 2020, and sources later described it scaling back in the UK, France, and Belgium to concentrate on China. Russia's 5G build-out is the next stop in that retreat-and-repivot.
The Kremlin's calculus, as Gabuev reports, is explicitly about surveillance trade-offs — 'bugged by the US or by China' — meaning the sanctions campaign that was meant to isolate Huawei has instead delivered it a new sovereign customer. That sits alongside the parallel effect of the campaign opening the $35B/year cellular equipment market to new players.
First-order effects
- Huawei becomes the lead vendor for Russia's 5G network, giving the Kremlin a Chinese-supplied build rather than a Western or diversified one, with Moscow accepting Chinese access as the lesser evil.
- Huawei gains a state-level reference customer in Europe's backyard, offsetting the European retreat its own sources describe.
Second-order effects
- Western and allied vendors are effectively locked out of the Russian 5G market, hardening the split the US campaign opened in the $35B/year equipment market into rival supplier blocs.
- China's own 5G program — where Japanese suppliers have stepped into the sanctions void — and Russia's become mutually reinforcing demand pools that keep Huawei's volumes up despite Western exclusion.
Third-order effects
- If the pattern holds, telecom infrastructure consolidates into two geopolitically aligned supply chains — US/EU-aligned and China/Russia-aligned — with vendor choice becoming an explicit alignment decision rather than a procurement one.
- Sanctions designed to degrade Huawei's market position instead convert it into the default infrastructure partner for states outside the Western orbit, a structural outcome regulators will weigh in future export-control decisions.
The trend: Export controls are splitting global telecom equipment into competing geopolitical supply blocs, with sanctioned Chinese vendors pivoting from Western markets to state customers in Russia and the Global South.