5G technology has the potential to transform the whole worldwide economy. At the same time, only a small number of suppliers from a few leading countries dominate the market. The main suppliers are from the US, China and the EU.

The so-called '5G race' is therefore not only about developing new technology, but also about power and geopolitics. Leaders in the US and China, in particular, view the competition over the new technology as a political rivalry. Issues around supplier dependency, digital sovereignty, and national security are a big concern.

The current debate focuses especially on concerns (as described in a report by the EU NIS Cooperation Group) that foreign state-backed hacking groups could use 5G equipment to hack into our systems and/or spy on us. This means that procuring gear and services from vendors from non-EU countries could pose a major security threat.

Within the European Union, each member state asseses potential cybersecurity risks at a national level. If the risk is considered to be too high, the involvement of particular suppliers can be restricted. 

Due to this fear of security threats such as espionage, cybercrime, and the disruption of critical infrastructures by China,  the US is trying to exclude Huawei. This ban can also be interpreted as a soft power play. For third countries, including those who are only consumers, this US-China rivalry presents difficult choices about whose 5G network technologies and related application ecosystem to adopt.

Governments are likely to come under pressure from the US and its allies to avoid dependence on China for 5G. However, developing countries that are more sensitive to the costs will find Chinese technology and its related enticements difficult to turn down. It also seems that China has surpassed the US in the development of 5G technology, as the US has none of its own 5G suppliers available.