A 3 year delay to the roll-out of 5G could cost the UK economy £18.2bn

UK set to lose its current 5G competitive advantage and global leadership

position through 2022 and 2023

The removal of Huawei equipment sooner than 2027 would lead to a further delay

to 5G roll-out and subsequent higher cost to operators and the UK economy.

London, UK – 9 September 2020 – Banning and removing Huawei from the UK’s 5G networks by 2027 risks severely delaying operators’ 5G roll-out plans, adversely affecting the UK economy by £18.2bn, and losing the UK’s current competitive advantage in 5G leadership, according to an independent report from Assembly.

The new report, commissioned by Huawei, builds upon the Government’s own expectation of a 3-year delay to 5G roll-out. The removal of Huawei equipment sooner than 2027 would lead to a further delay to roll-out and higher cost to the UK economy.

In the last 12 months, the UK mobile operators have made significant progress in deploying 5G infrastructure, putting the country in a strong position to reap the future economic benefits. However, as a result of continued US pressure and latest sanctions, this deployment will slow in future, impacting industrial efficiency, global competitiveness as well as, the associated economic benefits of being a global leader in 5G.

The report also highlights the DCMS’ conclusion that should the UK not maintain global leadership in 5G, it will miss the opportunity to fully realise £173bn of incremental GDP over 10 years between 2020 and 2030. Global leadership is important so that UK can take early advantage of the potential for 5G to create new opportunities for UK businesses at home and encourage inward investment – both of which contribute to the creation of a world-leading digital economy.

Of the £18.2bn economic impact, a result of the 3-year delay, about £10bn of productivity benefits would be lost entirely. Under a scenario where the UK is a global 5G leader, the mobile sector would miss out on the opportunity to generate about £4.7bn and related industries would lose about £2bn. The economy at large would miss benefits estimated around £1.5bn.

Matthew Howett, Principal Analyst & Founder of Assembly, said:

“As a result of further restrictions on Huawei in the US, the UK mobile operators are set to incur billions of pounds worth of cost stripping out equipment form their networks. This report reaffirms there is also an untold cost in terms of the economy and impact on productivity a delayed 5G roll out will have, the scale of which the UK can ill afford given the current economic circumstances.”

Victor Zhang, Vice President of Huawei, said:

“This new research shows how the US administration has directly impacted Britain’s economy, ending the UK’s leadership in 5G, holding the country back from realising its full potential for years to come.

Our priority at Huawei remains to support our customers in delivering and helping to build a better connected UK. This independent research, shows why we would urge the government to reconsider its decision. “

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