If approved, the proposal will help the United States better compete with Huawei in the race to deploy 5G networks.
The White House on February 8 dismissed Justice Justice William Barr’s proposal to allow the United States to control Nokia (Finland) and Ericsson (Sweden), two foreign rivals of Huawei’s telecommunications conglomerate .
Earlier, on February 6, Barr said that the United States and its allies should consider linking with the two groups to prevent Huawei’s rise in the race to deploy the 5G wireless network generation.
This can be done by buying shares to control corporations, either directly or indirectly through US private companies and allies. Barr said that a large market with strong financial potential like the US when behind these corporations will help them become a formidable opponent.
In a response, White House economic adviser Larry Kudlow said the US is working closely with Nokia and Ericsson, confirming their equipment is essential in building 5G infrastructure in the country. However, the US government does not buy shares of these companies, regardless of whether they are domestic or foreign.
“We respect Minister Barr’s opinion, but the best solution now lies with the proposal of Ajit Pai (Chairman of the Federal Communications Commission),” said US Vice President Mike Pence.
Specifically, Pai’s plan is that the US will expand 5G deployment with the power of the free market and US companies.
After this information, Nokia’s shares on the New York Stock Exchange rose 4%, while Ericsson shares on the Nasdaq increased nearly 5.4%. Both declined to comment on the information.
The total market capitalization of Nokia and Ericsson is about USD 53 billion . If the proposal is approved, it is not clear which US capital will be used to buy shares of these companies.