Europe - a battleground over Huawei’s 5G : the possibility of economic coercion by both the US and China to make a change on the Battlefield

Abstract

Huawei has been a global headline amid the intensifying US-China trade war, the potential for economic coercion from China and the US to deter the European Union (EU) from pursuing an unfavorable policy on Huawei's involvement in 5G network shall be examined. This paper explores EU's relations, notably its trade ties with the two powers and analyses the possibility of an economic coercion against the EU and the consequences of their actions. Through descriptive analysis of the trade and investment statistics, the paper finds that the EU is vulnerable to economic coercion from the US as well as China, however, if economic coercion is initiated, the US has to bear political, diplomatic, economic consequences; China has to bear diplomatic and economic consequences, therefore, neither the US nor China would impose economic coercion on the EU but rather use other tools or make threats. And the paper finds that it's highly likely that the EU would take a middle way on Huawei.