Huawei Ban: A chance to invest?
The United States is currently focusing on upgrading its telecommunication service to 5G; however, the ban of Huawei has forced the US to look into other providers in the industry like Ericsson and Nokia. Most recently, the US has been pondering if their 5G equipment has to be produced outside of China. According to the Wall Street Journal,
U.S. officials have long worried that Beijing could order Chinese engineers to insert security holes into technology made in China. They worry those security holes could be exploited for spying, or to remotely control or disable devices.
Washington has already essentially banned telecom equipment from Chinese companies, especially industry leader Huawei Technologies Co., from the U.S. over these cybersecurity worries, which Huawei says are baseless. Now, the White House is taking those concerns to the next step by asking Western telecom-equipment makers whether they can rejigger their China-dependent supply chains.
Because of this, should we start investing in companies that provide telecommunication services such as Nokia and Ericsson? Since fiber optics are also key components in making these telecommunication wires, is it time we also look into US companies that make these fiber optic cables like Corning?
While we don’t know how long the trade war will last, is it time we start digging deeper into the supply chain and investing in companies involved in the telecommunication service? If so, what other companies are also worth investing in this industry?
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