Why China's 5G riches are outside the reach of international investors

Business Standard Why China's 5G riches are outside the reach of international investors

The biggest beneficiaries of the country's push for wireless supremacy are outside the public domain

International News: How can investors profit from China’s race with the U.S. for 5G supremacy?

Finding the answer is as tricky as figuring out the geopolitics.

The nation’s sleepy telecom stocks came back to life after Huawei Technologies Co. CFO Meng Wanzhou was detained in Canada in early December. While the official charge was that the company had violated U.S. sanctions on Iran, many in China interpreted the action as another attempt by the American government to thwart the country’s advance in 5G. Huawei leads the world in the number of declared essential patents for nextgeneration wireless technology, according to the European Telecommunications Standards Institute.

The Chinese equipment maker’s woes have only served to spark investor enthusiasm for anything 5G. On Dec. 7, the Ministry of Industry and Information Technology awarded 5G spectrum licenses to its three telecom operators, allowing them to conduct final trials before widespread commercial rollout in 2020. A month later, the government said it will issue temporary licenses in some cities as early as this year. Unlike Europe and the U.S., China is wasting no time in moving ahead on 5G. Shares of wireless antenna makers and state-owned China Tower Corp. have been on fire. The monopoly operator of mobile-phone masts has gained more than 40 percent in Hong Kong since early December, bringing its market capitalization to $37 billion. On Monday, when Chinese traders returned after the week-long Lunar New Year holiday, the dozen or so mainland-listed companies that manufacture wireless antennas jumped 4.3 percent. Hong Kong-listed Comba Telecom Systems Holdings Ltd. has soared more than 70 percent.