Subscribe
E-Paper
 |
| Huawei is hoping to reset relations with the U.S. under the new administration. AP-Yonhap |
By Kim Yoo-chul
Market analysts said Wednesday that Korean mobile carriers could benefit if U.S. President-elect Joe Biden's administration takes a different stance on China's Huawei, with LG Uplus emerging as the biggest potential beneficiary.
The Trump administration imposed tough sanctions on Huawei in August that effectively cut Huawei off from some U.S.-developed technology.
The sanctions added to action Washington has taken in the past 15 months against the Chinese telecom equipment giant over what it cited as national security risks. Huawei has consistently denied the allegations.
Huawei was hoping to reset relations with the United States under the new administration as U.S. sanctions have put much pressure on the company's margins. Compounding the problem is the so-called "anti-Huawei" campaign by the U.K. and Australia.
But according to reports by Hana Financial Investment, one of the country's leading brokerages, and an official with knowledge of the issue, "Huawei's woes" would be addressed in March or April next year.
"Because of the U.S.'s ban on Huawei parts, the overall telecom network industry is suffering from a huge shortage of relevant components," an official familiar with the issue said.
"Huawei was seeking an 'exit-strategy' and it's been told that the U.S. may offer corresponding measures if Huawei shows a willingness to handle issues that concern the U.S. Once conditions are met, then Washington could approve the sale of Huawei parts to the United States. The timing would possibly come either in March or April."
Hana Investment's Kim Hong-shik presented 18,000 won as its target share price for LG Uplus, Huawei's top South Korean client, citing easing worries over Huawei issues.
"It's likely that Washington will approve the sale of Huawei's fifth-generation (5G) parts to the United States," Kim said.
Huawei was said to have had discussions with governments to set up new rules regarding "trust issues." For LG Uplus, its Huawei dependence for the 5G network is about 30 percent.
Meanwhile, San Diego-based mobile chipset giant Qualcomm is trying to persuade Washington to give it "special permission" to provide Huawei with components after it reportedly received approval to sell 4G chips to the company.
In November, the U.S. banned the installation of Huawei 5G gear, starting in September 2021. It also decided to spend some $333 million to diversify its 5G component procurement channel following its previous ban on the Chinese company.
