Soon after British Prime Minister Boris Johnson placed a phone call to President Trump to discuss telecom security, US Treasury Secretary Steven Mnuchin talked on a visit to the foreign affairs thinktank Chatham House in London.

A wide-ranging discussion between Mr. Mnuchin and the Chatham House director, Dr. Robin Niblett, touched on subjects from the prospects for a trade deal between the U.S. and the U.K. once the latter is out of the European Union to that thorny topic, Huawei. 

After the conversation had been broadcast, Dr. Niblett appeared on BBC radio, commenting on what had been said, and he had something fascinating to say about how he interpreted Mnuchin’s comments on Huawei. 

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The Trump administration does not want the U.K. to deploy Huawei 5G technology in the country’s infrastructure, advising very strongly that it would be detrimental to security, and could result in the U.K. being seen as less central to the sharing of security between the Five Eyes countries (U.S., U.K., Australia, New Zealand and Canada). There were even hints at one point that if Britain lets the Chinese company’s tech help build the U.K.’s 5G network, well, maybe that trade deal would be elusive. 

Mr. Mnuchin was positive about a trade deal, so that threat seems to have receded. And the Financial Times has reported that Britain’s security services believe the security risks can be managed. The FT reports:

One government official said: “Imagine if we decided to throw out Huawei on security grounds, but our own security officials say there isn’t a problem. How would that look if we were taken to judicial review?”

But the most interesting thing from Saturday’s exchange was what Dr. Niblett, a highly incisive reader of political statements, spotted in the Treasury Secretary’s comments. 

Niblett explained, “Secretary Mnuchin was very careful in what he said, as one would expect, it was all on the record… but the one sentence that I thought was interesting [was that] the part of the network that the Huawei equipment goes into matters,” Niblett said. 

He went on to explain why it was important: “Mnuchin’s exact phrase is ‘What part of its network it goes into matters.’ Now, to start splitting definitions of what the network is, is precisely what the British government is trying to do. It’s saying, ‘Oh, don’t worry, we’ve just got Huawei in the outside stuff, we’re not going to let it into the core.’ So, I think maybe I’m over-reading into it, but it struck me that if Boris Johnson can come up with the right narrative, there was a little glimmer of light there for a compromise, I thought.”

And if that’s what Mnuchin thinks, then it’s pretty certain it’s what his boss, President Trump, thinks too.

If Dr. Niblett is right, this is big news for Huawei. If the U.S. government will not penalize Britain if it chooses to let Huawei be a part of the network – as it’s pretty much certain to do when a decision is announced, expected on Tuesday, January 28 – then that puts Huawei in a much stronger position when it comes to selling its 5G equipment to other countries. 

Of course, it doesn’t sole the conundrum of the other part of the business, those smartphones that can’t use Google Mobile Services. 

But it would be a big win for Huawei. 

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Follow me on Instagram by clicking here: davidphelantech and Twitter: @davidphelan2009

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