Phasing out Chinese tech could cost Europe $400bn, China's researchers did the math
European Union proposals to tighten cybersecurity by phasing out equipment from Chinese suppliers risk costing the bloc over $400 billion in the next five years, with Germany facing nearly half of the burden, China's Chamber of Commerce to the EU (CCCEU) said on Wednesday.
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European Union proposals to tighten cybersecurity by phasing out equipment from Chinese suppliers risk costing the bloc over $400 billion in the next five years, with Germany facing nearly half of the burden, China's Chamber of Commerce to the EU (CCCEU) said on Wednesday.
Under new cybersecurity rules, the EU plans to phase out components and equipment from "high-risk" suppliers in critical sectors, a move criticised by China's telecoms giant Huawei, which is set to be among the affected companies.
Beijing wants clauses that define "countries posing cybersecurity concerns" and "high risk" to be dropped from the proposed rules and last week threatened countermeasures against the EU if substantial changes are not made.
A study for the CCCEU, carried out by KPMG, said the forced replacement of Chinese suppliers across 18 critical sectors would cost the EU 367.8 billion euros ($432.83 billion) between 2026 and 2030. The EU would have to replace hardware and write down assets and contend with lower efficiency and delayed digitalisation, the report said.
Two of the heaviest-hit sectors would be energy and telecoms, pillars of the EU's planned digital and green transitions.
Six EU countries would face losses of more than 10 billion euros - Germany, France, Italy, Spain, Poland and the Netherlands. For Germany, the bill would be 170.8 billion euros.
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EU governments and the European Parliament are in the early stages of the lengthy legislative process required for the new rules to become law, a process likely to result in amendments.
Cybernews has previously reported that the European Commission recommended member states exclude Huawei and ZTE network equipment from local telecom operators' connectivity infrastructure due to security concerns. A spokesperson for the European Commission confirmed this to Reuters during a briefing in Brussels on Monday.
The representative also told the news agency that new cybersecurity rules, which aim to phase out network components from so-called "high-risk suppliers," would grant the EU the possibility to ban the use of network gear from companies like Huawei and ZTE.
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