Europe plots catch-up in global 5G race

Europe plots catch-up in global 5G race
Global 5G mobile subscriptions are expected to reach 220 million by the end of this year, ‘with China accounting for almost 80 percent of the total.’ (Reuters)
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Updated 29 December 2020

Europe plots catch-up in global 5G race

Europe plots catch-up in global 5G race
  • European mobile operators have long been reluctant to start investing in 5G networks

STOCKHOLM: The year 2021 could be a do-or-die year for Europe’s efforts to catch up with China and the US in rolling out super-fast fifth-generation (5G) telecoms networks.

The mission to introduce the technology, which ultimately promises internet speeds up to 20 times faster than today, could be crucial to how competitively the continent emerges from the economic ruins of the COVID-19 pandemic.

Mindful of this, the European Union is funneling a fifth of its €750-billion ($914 billion) recovery fund to improve countries’ digital capabilities.

European mobile operators have long been reluctant to start investing in 5G networks, which could support smart factories and self-driving cars, because of a lack of political clarity about whether they must accede to US demands to exclude leading equipment supplier Huawei and other Chinese vendors.

But encouraged by the EU financial commitment to the technology in this area, at a time when the US administration is changing, and fearful of falling further behind globally, the industry is preparing to plow ahead in 2021.

“Europe is, unfortunately, behind,” Pekka Lundmark, chief executive of Finnish network equipment maker Nokia, told Reuters. But the rollout “is accelerating already and in 2021 I think it will gather more speed in most countries.”

Swedish equipment maker Ericsson forecasts Europe’s 5G coverage should grow from around 1 percent of mobile subscriptions across the continent in 2020, to 55 percent in Western countries and 27 percent in central and eastern states over the next five years, underpinning a longed-for economic recovery. Yet it is the mobile operators who must pay companies like Ericsson, Nokia and Huawei billions of dollars for the 5G equipment.

The EU agreed on its rescue package in July, and companies started drawing up digital plans.

“We spent the whole summer since the announcement working to set out tangible projects,” said Jose Maria Alvarez-Pallete, CEO of Spanish operator Telefonica.

A European Commission spokeswoman said the first payments could be made in the summer of 2021.

Among various digital projects, Telefonica calculates the funds could help cover all of Spain with fast fiber-optic internet and extend standalone 5G — capable of giving the highest performance — to around 85 percent of the country by 2025.

Geopolitical grapple

While an individual consumer can use 5G for making calls and browsing the internet, the technology’s main benefit lies in creating new businesses, automating factories and running critical infrastructures like power grids.

Global 5G mobile subscriptions are expected to reach 220 million by the end of this year, with China accounting for almost 80 percent of the total, Ericsson said in a report last month. North America is expected to have 4 percent.

“As with 4G, first movers advantage is huge and countries rolling out 5G early will see most of the innovation,” an Ericsson spokeswoman said.

“Unless Europe moves quickly, it risks lost growth and weakening industrial competitiveness in manufacturing and logistics that could cost billions of euros in new wealth.”

Geopolitics remains a major risk, however.

Pressure from the US on its allies to shun Huawei’s equipment from its networks is unlikely to disappear. The US accuses Huawei of facilitating Chinese spying, allegations denied by the company and Beijing.


Indonesia campaign helps SMEs enter Saudi market

Indonesia campaign helps SMEs enter Saudi market
Updated 19 January 2021

Indonesia campaign helps SMEs enter Saudi market

Indonesia campaign helps SMEs enter Saudi market
  • They will be the main target of the export initiative, which is estimated by the Indonesian Ministry of Trade to be able to generate $60 million

JAKARTA: Indonesia has launched a campaign to help small firms in the country compete for millions of dollars-worth of food trade in Saudi Arabia.

The government aims to help small and medium-sized enterprises (SMEs) improve the quality and competitiveness of their products to meet the Kingdom’s required standards, Indonesian trade and commerce officials have said.

Under normal circumstances, before the coronavirus disease (COVID-19) pandemic, around 1.5 million Indonesians a year make the pilgrimage to Saudi Arabia to perform Hajj and Umrah and hundreds of thousands work in the Kingdom.

They will be the main target of the export initiative, which is estimated by the Indonesian Ministry of Trade to be able to generate $60 million.

To meet the Saudi food regulator’s standards, the Indonesian Chamber of Commerce (Kadin), the Ministry of Trade, and the Ministry of Cooperatives and Small-Medium Enterprises have teamed up to assist SMEs in improving products such as bottled chili sauce, soya sauce, coffee, tea, and sugar that are in highest demand among Indonesians in Saudi Arabia.

Kadin chairman, Rosan Roeslani, told Arab News: “We have facilitated five small-medium enterprises that produce soya sauce to obtain Saudi Food and Drug Authority approval for distribution, while nine tea and coffee producers are in the pipeline to also obtain a license. We have also submitted the application for four bottled chili sauce producers.”

While travel and pilgrimage restrictions remain in place due to the COVID-19 outbreak, he said that the time before things get back to normal will be used to prepare the SMEs — which contribute 60 percent to the country’s gross domestic product and employ up to 90 percent of its workforce — for expansion into the Saudi market as soon as the pilgrimage sector resumes.

“We still have time to groom them as there are many aspects such as hygiene, and consistency in their product quality and quantity that they need to improve,” Roeslani added.

In 2014, the Ministry of Religious Affairs issued a regulation obliging catering companies that provided food and drink to Indonesian pilgrims in Saudi Arabia to source their products from Indonesian producers whenever possible.

Indonesia’s vice religious affairs minister, Zainut Tauhid Sa’adi, said that as each Indonesian pilgrim received food from caterers an average 75 times during his or her pilgrimage, demand was high but supply in Saudi Arabia remained limited and similar products from India and Thailand had been used instead.

Kasan Muhri, director general for export development at the Ministry of Trade, told Arab News that the program to prepare the SMEs had been in the making since 2017 and officials eventually decided to launch it this year despite the COVID-19 restrictions.

“Just because there are few Umrah pilgrims now and this year’s Hajj remains uncertain, it does not mean that the market is gone.

“People from around the world would still go to Saudi Arabia to perform the pilgrimage, not just Indonesians, so we are doing this to anticipate the market when the economy revives, and things are recovered. We don’t want to be left behind,” Muhri said.

Besides food and beverage products, officials say they are also looking into the possibility of exporting items such as goodie bags, prayer beads, and other pilgrimage accessories made by Indonesian SMEs.