China’s tech hub of Shenzhen is going to fork out fat orders worth tens of billions of yuan to shore up the business of Huawei and ZTE, which are both based in the city, as the municipal government aims to build up to 7,000 5G base stations and peripheral equipment across the city by the end of the third quarter.

Shenzhen is knitting an ultra-fast wireless next-generation network that is ready for a city-wide rollout by the end of the year, according to local papers.

Enterprises based in the tech hub are expected to launch 5G terminal chips in the first half of this year, Xinhua quoted officials with the city’s industry and information technology bureau as saying.

Shenzhen aims to further lead the global charge into the 5G era and those who want an early glimpse of what 5G can offer may come to Shenzhen to see for themselves, the report said.

A bird’s eye view of Huawei’s corporate headquarters in Shenzen. Photo: WeChat

Shenzhen’s drive, reportedly in partnership with the state-owned telecommunications infrastructure company China Tower, will further help Huawei secure a stable flow of orders and maintenance contracts in the years to come, as the Chinese tech giant is being locked out in parts of the West given a US-led blanket ban on their gear, as many of the US’s allies are closing their ears to Beijing’s call for fair market access.

That said, Huawei insists its global 5G business is booming, and that it has 40 5G contracts with overseas carriers – 23 in Europe, 10 from the Middle East, six from Asia and one from Africa.

But additional orders from its home city are always heartening.

Also, in late January, Guangzhou’s Baiyun Airport launched a 5G base station and an indoor 5G network has been up and running in Shanghai’s Hongqiao Railway Station. Both places use Huawei’s devices.

Last month, however, the Financial Times reported that Huawei had no 5G contracts from mainland China, as Beijing hit the brake and scaled back its roll-out of the new technology.

“Until today, only one commercial contract for 5G is from the Greater China Region, and that’s in Hong Kong,” said Yang Chaobin, president of Huawei’s 5G product line.

Annual results from the country’s biggest telecoms carrier, China Mobile, show its planned capital expenditure on 5G – 17.2 billion yuan (US$2.6 billion) – is half the level that analysts had forecast.

Meanwhile, the newspaper said a delay of a key 5G standard – relating to 5G for consumer and other basic uses – has put a spanner in the supply chain. The standard was only promulgated in March.

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