Post-Covid business cycle resumes 5G digital race around the world

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The EIU study compiles information on 5G among the 60 most advanced telecommunications markets on the planet. Around six essential metrics and parameters for the deployment of the digital technology par excellence: the business climate, the spectrum efficiency, its current development rates of 5G, the speed of its networks, its transfer to the industry and the robustness of its technology policies. And from whose analysis several conclusive diagnoses are derived. The one with the greatest substance, because the leadership of 5G is at stake, is, perhaps, the one that reveals the advantage of Asia in this geostrategic race. Tboth in their deployment and in the quality and speed of their services, which gives them global hegemony.

The Gulf Emirates and the Saudi market also offer “significant business opportunities for providers of next-generation technology” because they are among the most avant-garde spaces of 5G. Behind them, Europe, despite the slowdown in spectrum spread actions during the Covid-19 recession, offers “notable investment niches”; Above all, due to the momentum that the common digital policy has gained with the resources of the Next Generation EU and its integration into national legal systems and its channeling towards its industrial sectors, with a succession of digital applications that are revitalizing this productive segment after decades of gradual abandonment in favor of the service economy. The change of cycle – and of the American Administration – have been the triggers for the recent progress detected in 5G in the US. Already under Joe Biden, says report. Due to a greater coordination of the legislation in progress and the implementation of reforms aimed at overcoming “the inadequate digital policies” of the last legislature.

In contrast, African and Latin American countries are committed to “continuing to expand 4G and broadband fiber infrastructures in the medium term”, given the structural blockage of a structural investment deficit, their low capacity to monitor 5G spectrum and its budgetary difficulties to modernize the technology networks of the new spectrum. For EIU experts, the key for capital flows to penetrate these markets will emerge when advances are detected from the government level.. With actions that establish clear objectives and intermediate goals, tax incentives, low-cost credit programs and seamless institutional support for the development of 5G. However, the dispute between the US and China, with Huawei spearheading a series of investment prohibitions with global effects, increases the level of risk in capital portfolios. At a key moment. Because the pandemic led to a drain on investment from 5G projects. And it even canceled national roadmaps for its expansion. As in Poland or India, which canceled their development plans in 2020. Meanwhile, the firms in the sector have reorganized. Already before the Covid-19. In the wake of the tariff battle between Washington and Beijing, their investment efforts in technology. While some countries, subjected to pressure from the US to restrict Huawei’s activities, have altered their strategies on 5G and others, from emerging and developing latitudes, to the influences of China and its preferential financing lines in infrastructure, such as those of the mobile generation that will dominate the current decade.

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In any case, the coronavirus has accelerated digitization and increased investment opportunities in telecommunications operators. Towards connections that are vital for businesses, consumers and economies. For companies, the Covid-19 crisis has diminished their benefits, which has led them to increase their online offers, to promote automation processes and Internet of Things (IoT) projects in order to reengage their value chains. For consumers, it has meant an exceptional upturn in demand for telematic goods and services. And for governments and economies, a blazing development of online applications, essential for telemedicine or telework, and an ideal climate for the advancement of Big-Data, Artificial Intelligence and robotics. Everything, under 5G technology, with which to launch automation in the driving of vehicles or the Smart Cities projects that many cities have undertaken around the world.

The hyper-fast connection of 5G and its low latency add investment margins in R & D & i firms and governments. To gain market share, in the case of the former, and to generate employment and stimulate dynamism, in that of the countries. And to both, benefits with the plans for the renewal of infrastructure networks that take place all over the world. Especially in the industrialized powers.

EIU experts geographically review the risks and opportunities of the investment boom in which the global situation has been immersed at the beginning of the recently inaugurated economic cycle. In Asia, South Korea, Taiwan and China stand out among the undisputed leaders of 5G. Although they point to Thailand as the hidden market, with special potential, compared to India and Indonesia, which they identify as two of the nations with the greatest lethargy in the evolution of 5G. Japan is the poker of the most advantageous markets.

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If in Asia the official support for 5G is valued -in practically the entire region-, the aid to telecommunications firms, strategic in the case of China, and tax advantages and investment incentives, in Australia, Taiwan or Japan , from Europe, the EIU highlights the focus of 5G on industrial processes. In full digitization phase. Despite the paralysis of technical tests in Portugal, during the pandemic, or its slowdown in leading countries such as the Netherlands or Sweden. By mid-year, only 8 of the 23 markets analyzed by this study had fully covered their 5G spectrum. Europe – says the report – “is in a position to treat both China and the US between 2021 and 2022 for efficient community regulation.” And despite the fact that some partners have not yet ruled out Huawei’s technological option. With measures such as the requirement of the European Commission to have uninterrupted 5G coverage in the large cities of the common space by 2025. Or the catapult of digitization on its industry. With action plans and industrial technology applications deployed in parallel to 5G networks and licensing. “The strong public awareness to promote connection towers” is the great investment lifeline in Europe, whose threat lies in the high levels of debt of its operators, which could force consolidations or delays in capital injections from the market.

The Persian Gulf countries are among the pioneers of 5G. Saudi Arabia, Kuwait and the United Arab Emirates (UAE). In fact, the 6 partners of the Gulf Cooperation Council completed their 5G spectra already in 2018 and launched their first network services in mid-2019. All of them have also integrated their development into their different economic diversification plans and are looking for investments. , companies and technological advances to prop up its newly reactivated manufacturing hubs. Although the 5G capacity in the region is still at 50%. Israel shows a notable delay. The operators in its market continue to bet on 4G with projects that reached a coverage of 75% in 2020 and forecasts of achieving 95% in 2022. Ratios that are considerably reduced in the African space. South Africa, for example, its large market, penalties has temporarily assigned 5G spectrum to certain operators. Among other reasons, to consolidate remote work during the epidemic. Most African nations continue to push 4G. The digital ambitions of Smart Cities in the Gulf countries are a stimulus to investment. Faced with the uncertainties about the choice of Huawei in countries dependent on Chinese financing lines.

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On North America, the EIU emphasizes the hegemonic status of the United States. Due to its early launch stage of 5G, the strength of its business framework and the ideal environment to formalize business. America’s 5G spectrum has already facilitated commercial development. The first tests began in 2017. Although it still has to accelerate its investments in infrastructure, modernize its regulation and establish more intense public-private consensus. In this sense, they explain that the legislative initiatives of the Biden Administration to spur digitization, through 5G, “in industry, sustainable energy networks or increased productivity are going in the right direction.” In fact, in its diagnosis of North America, which includes Canada, the recommendation to investors highlights the impulse of companies to R + D + i of their technological projects and warns about regulatory fragmentation and the geostrategic conflict that both nations have maintained with China since the Huawei affair. Or the speed deficit of their specters.

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