Russia rolls out the red carpet for Huawei over 5G

People queue outside a newly opened Huawei flagship store in Shenzhen in China’s southern Guangdong province. (AFP)
Updated 30 September 2019

Russia rolls out the red carpet for Huawei over 5G

  • The smartphone company plans to lead in the development of 6G in future, says top official

MOSCOW: While the US banned Huawei for alleged espionage and asked its allies to do the same, Moscow has rolled out the red carpet for the Chinese tech company, letting it develop 5G networks in Russia.

Analysts say the move is as much a show of solidarity with Beijing against the US as it is a drive to bring ultra high-speed internet to Russian tech users.

This month, Huawei opened its first 5G test zone in Moscow in partnership Russian operator MTS, with a view to rolling out the service to the rest of the capital.

Moscow authorities say the network will become part of the city’s normal infrastructure within the next few years.

A pioneer in telecoms networks compared to many Western countries, Russia plans to deploy 5G in all of its main cities by 2024.

When Chinese President Xi Jinping visited Russia in June — at the height of Washington’s conflict with Huawei — Russia’s main operator MTS signed a contract with the Chinese company.

At the inauguration of the 5G zone in Moscow, the CEO of Russia’s branch of Huawei Zhao Lei praised the company’s activities in the country.

“We have been working in Russia for 22 years. Thanks to our partners, we live well here,” he said. He added that Huawei, considered a world leader in 5G technology, plans to “lead in the development of 6G” in the future.

Huawei is also the world’s second-largest smartphone company. It did not respond to AFP’s interview requests. A source in Russia’s 5G research community said Huawei is the biggest investor in the development of mobile technologies in Russia, with “the largest research laboratory of all operators” in Moscow.

According to the Vedomosti business daily, Huawei currently employs 400 people in Moscow and 150 in Saint Petersburg in mobile research and development. It aims to employ 500 more people by the end of 2019 and 1,000 more over five years.

Experts said Russia’s welcome of Huawei does not mean the Chinese company is alone in the race for developing 5G in Russia.

“Russian operators are all collaborating with multiple 5G equipment vendors, Huawei included. We do not see any clear 5G leaders in the network deployment in Russia,” said Michela Landoni, an analyst at Fitch Solutions. She said operators prefer this approach to avoid being “reliant on one specific vendor” and to protect themselves against cyber threats.

The Tele2 operator was the first to launch 5G in Russia with Sweden’s Ericsson in August, on Moscow’s main Tverskaya street.

In the midst of a trade war and technological rivalry with China, the US has threatened to cut Huawei’s access to the US components and services it needs, such as the Android operating system that the company uses on its phones.

Russia then promptly stepped in to offer its Aurora operating system to the Chinese group.

If Android remains Huawei’s preferred choice, Landoni said Aurora could be a “short-term solution” for the group.

According to the analyst, Aurora could become a “stepping stone” in the development for Huawei’s own OS.


Saudi Aramco shares soar at maximum 10% on market debut

Updated 15 min 17 sec ago

Saudi Aramco shares soar at maximum 10% on market debut

  • Company is now world’s largest publicly traded company, bigger than Apple
  • More than top five oil companies combined

RIYADH: Saudi Aramco shares opened at 35.2 riyals ($9.39) on Wednesday at the Kingdom’s stock exchange, 10 percent above their IPO price of 32 riyals, in their first day of trading following a record $26.5 billion initial public offering.
Aramco had earlier priced its IPO at 32 riyals ($8.53) per share, the high end of the target range, surpassing the $25 billion raised by Chinese retail giant Alibaba in its 2014 Wall Street debut.
Aramco’s earlier indicative debut price was seen at 35.2 riyals, 10 per cent above IPO price, raising the company’s valuation to $1.88 trillion, Refintiv data showed.
At that price, Aramco is world’s most valuable listed company. That’s more than the top five oil companies – Exxon Mobil, Total, Royal Dutch Shell, Chevron and BP – combined.
“Today Aramco will become the largest listed company in the world and (Tadawul) among the top ten global financial markets,” Sarah Al-Suhaimi, chairwoman of the Saudi Arabian stock exchange, said during a ceremony marking the oil giant’s first day of trading.
“Aramco today is the largest integrated oil and gas company in the world. Before Saudi Arabia was the only shareholder of the company, now there are 5 million shareholders including citizens, residents and investors,” said Yasir Al-Rumayyan, the managing director and chief executive of the Saudi Public Investment Fund.
“Aramco’s IPO will enhance the company’s governance and strengthen its standards.”
Amin Nasser, the president and CEO of Saudi Aramco, meanwhile thanked the new shareholders for their confidence and trust of the oil company.
The sale of 1.5 percent of the firm, or three billion shares, is the bedrock of Crown Prince Mohammed bin Salman’s ambitious strategy to overhaul the oil-reliant economy.
Riyadh’s Tadawul stock exchange earlier said it will hold an opening auction for Aramco shares for an hour from 9:30 a.m. followed by continuous trading, with price changes limited to plus or minus 10 percent.

The company said Friday it could exercise a “greenshoe” option, selling additional shares to bring the total raised up to $29.4 billion.
The market launch puts the oil behemoth’s value at $1.7 trillion, far ahead of other firms in the trillion-dollar club, including Apple and Microsoft.
Two-thirds of the shares were offered to institutional investors. Saudi government bodies accounted for 13.2 percent of the institutional tranche, investing around $2.3 billion, according to lead IPO manager Samba Capital.
The IPO is a crucial part of Prince Mohammed’s plan to wean the economy away from oil by pumping funds into megaprojects and non-energy industries such as tourism and entertainment.
Watch the video marking Aramco’s opening trading:

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