US lawmakers want to help rural telecoms replace Huawei, ZTE equipment

WASHINGTON (Reuters) – A bipartisan group of US lawmakers introduced legislation on Wednesday to provide about $ 700 million in grants to help US telecoms providers cost the cost of removing Huawei equipment from their networks.

FILE PHOTO: Senator Tom Cotton (R-AR) comes to a Senate Knowledge Committee hearing evaluating the Intelligence Community's review of "Russian activities and intentions in recent US elections" on Capitol Hill in Washington, USA, May 16, 2018. REUTERS / Joshua Roberts

The bill also moves to block the use of equipment or services from Chinese telecom companies Huawei and ZTE in the next generation 5G network, according to a statement by the senators.

The United States has accused ZTE Corp and Huawei Technologies Co Ltd of working for the Chinese government and has expressed concern that their equipment could be used to spy on Americans, allegations that Chinese government and companies say are unfounded.

"With so much at stake, our communications infrastructure must be protected from threats from foreign authorities and companies such as Huawei," said Tom Cotton, a Republican Senator supporting the bill, in a statement.

Mark Warner, the top democracy in the Senate intelligence committee, and Roger Wicker, the democratic leader of the Senate Commission, also support the bill.

While large US wireless companies have cut ties with Huawei, small rural companies have relied on Huawei and ZTE switches and equipment because they are often cheaper.

The Rural Wireless Association, which represents operators with fewer than 100,000 subscribers, estimates that 25 percent of its members have Huawei and ZTE in their networks and have said it would cost $ 800 million to $ 1 billion to replace it.

The move goes beyond the steps hitherto taken by US President Donald Trump's administration, even as it has hardened its attitude toward Huawei.

In August, Trump signed a bill that prevents the US government from using Huawei and ZTE equipment.

Last week, the US Department of Commerce Huawei and 70 affiliated companies, which prevented the company from buying parts or components from US companies without US government approval.

Five days later, the US government simplified temporary trade restrictions so that the Chinese firm can buy US merchandise to maintain existing networks and provide software updates to existing Huawei headsets.

Reporting of Makini Brice; Editing Lisa Shumaker

Our Standards: Thomson Reuters Trust Principles.

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