Trump likely to sign executive order banning Chinese telecom equipment next week

Trump likely to sign executive order banning Chinese telecom equipment next week

President Donald Trump is expected to sign an executive order banning Chinese telecom equipment from US wireless networks before a major industry conference at the end of February, three sources told POLITICO, Trend reports referring to South China Morning Post.

The administration plans to release the directive, part of its broader effort to protect the US from cyber threats, before MWC Barcelona, formerly known as Mobile World Congress, which takes place Feb. 25-28.

The current plan is for Trump to sign the long-delayed executive order next week, according to a source close to the administration, who requested anonymity to candidly discuss internal deliberations.

“There’s a big push to get it out before MWC,” said an industry source familiar with the matter, who also requested anonymity to speak candidly.

By preempting MWC, the world’s largest conference for the wireless industry, the White House hopes to send a signal that future contracts for cutting-edge technology must prioritize cybersecurity. That could further roil the Trump administration’s already tense relationship with Beijing, especially if the US push erodes Chinese firms’ significant European market share.

The Chinese telecom giants Huawei and ZTE have been in the Trump administration’s crosshairs as part of a broader focus on Chinese national security threats that has paralleled the ongoing trade war. Trump officials have repeatedly slammed Beijing for its theft of intellectual property and its more traditional cyber espionage.

In December, the Justice Department indicted two Chinese operatives for a decadelong campaign of digital intrusions into US businesses and government agencies. And in January, DOJ unsealed a suite of charges against Huawei and its chief financial officer, who faces extradition to the US for violating sanctions on Iran.

Many countries are eager to deploy next-generation 5G wireless networks to power the rapidly proliferating internet of things, and Chinese firms such as Huawei and ZTE are aggressively pushing to build these networks — at a lower cost than virtually all of their competitors.

With these 5G build outs looming, senior officials want “to move the needle” with their security messaging, said the source close to the administration.

“Contracts are going out now,” this person told POLITICO. “Extra stigma could change the situation out in the countries on this major decision.”

“We’re going to be asking people to do things, but the US legal and regulatory environment hasn’t really closed the circle yet on this issue,” said Paul Triolo, who leads the consulting firm the Eurasia Group’s global technology practice. “So there’s a lot of pressure now to get this EO out there.”

The White House declined to comment for this story, but National Security Council spokesman Garrett Marquis said that the US was “working across government and with our allies and like-minded partners to mitigate risk in the deployment of 5G and other communications infrastructure.”

MWC is expected to feature several telecom security meetings, and a second industry source said the US is sending an interagency delegation of at least 20 officials and staffers. Attendees will include FCC Chairman Ajit Pai; Rob Strayer, the State Department’s top cyber official; Strayer’s boss Manisha Singh, the acting undersecretary of state for economic growth, energy and the environment; and Brian Bulatao, Trump’s nominee to be under secretary of state for management.

Trump’s telecom directive, which will invoke the International Emergency Economic Powers Act, has been finished for months. As POLITICO first reported last August, it was originally paired with a second order formalizing an interagency team that reviews foreign entities’ telecom investment requests. At the time, sources said that Trump would also sign a memorandum explaining how agencies should implement both directives. It is unclear if that will still happen.

Concerns about foreign firms helping US adversaries infiltrate sensitive computer systems, whether wittingly or unwittingly, have gained prominence in recent years. After alleged Russian government hackers interfered in the 2016 election, officials increased their scrutiny of the Russian cybersecurity firm Kaspersky Lab, and DHS eventually banned its antivirus products from government systems.

DHS has recently taken a lead role in helping to protect the sprawling and often opaque global web of manufacturers and resellers — also known as the “supply chain” — that delivers equipment and software to the US. The department created a task force that will, among other things, develop criteria for security assessments, assemble an approved-manufacturers list and advise companies about supply chain threats.

In addition, the latest defense policy bill bans agencies from buying and using Huawei and ZTE equipment.

Meanwhile, State Department officials are warning their foreign counterparts about 5G security as often as possible.

“We’re raising it at the highest diplomatic levels,” Rob Strayer of the State Department said Wednesday during an event at the Center for Strategic and International Studies. “We’re making sure that the most senior policymakers in governments are aware of the momentousness of this decision and what is at stake in the decision they’re about to make.”

But the US still hasn’t developed an alternative, Huawei-free vision for the massive, complicated and high-stakes global 5G buildout.

Trump administration officials are still “trying to understand the full range of options,” John Costello, director of strategy, policy, and plans at the Cybersecurity and Infrastructure Security Agency, said at the CSIS event.

The message to Europe about 5G, according to the second industry source, has been, “Go slow. There’s no need to rush into this. We need to figure out how to do this now.”

Right now, the source said, US telecom companies have “no clear guidance on how to proceed” with a 5G buildout that excludes Huawei, which controls 28 percent of the global telecom equipment market.

If Trump signs the telecom directive before MWC, the US will be able to attend the conference armed with fresh evidence of its commitment to the issue.

The administration’s desire to make a strong impression at MWC is so great that, at one point, Secretary of State Mike Pompeo planned to attend the event, according to the second industry source. This person said that former House Speaker Newt Gingrich, one of Trump’s closest outside advisers, “called Pompeo and said, ‘What the hell are we doing on 5G?’” (Gingrich did not respond to a request for comment, and State declined to discuss its delegation.)

“The geopolitics of 5G have come home to roost,” said Triolo, “and Barcelona is now the epicenter of the whole thing.”

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