EU trade chief alleges subsidies to Huawei, ZTE
Alleged subsidies again an issue for ZTE, Huawei, but no formal probe launched yet
The European Union's top trade official has raised the rhetoric in a brewing telecoms trade row with China, citing Huawei and ZTE for violating anti-dumping and anti-subsidy guidelines, but stopped short of a formal investigation.
Trade Commissioner Karel De Gucht, speaking in an interview in New York, said the core of his concern was access to cheap capital that "creates a distorted playing field".
Cheap finance from China's state-backed banks is increasingly regarded by the EU and the United States as an unfair subsidy that breaks global trade law.
De Gucht said he was prepared to launch a formal investigation into anti-competitive behaviour by the Chinese firms in order to protect a strategic sector of Europe's economy.
Huawei and ZTE, respectively the world's No 2 and No 5 makers of telecom equipment, have previously denied benefiting from illegal state support.
Huawei spokesman Scott Sykes yesterday told the Sunday Morning Post that the company was disappointed that the European Commission had "taken the unprecedented step of deciding in principle to open the first ever ex officio dumping and subsidy investigations".