The federal government in Ottawa is giving $40 million to Finnish telecom giant Nokia (NYSE: NOK) to conduct research on 5G wireless technology within Canada.
The funding comes as the federal government is in the middle of a national security review of the potential involvement of Chinese technology company Huawei in Canada's eventual fifth-generation mobile phone network.
Huawei, Nokia and Sweden's Ericsson are among the top contenders to help Canada's telecommunications companies, including BCE and Telus, build the country's 5G mobile networks.
Three of Canada's partners in the "Five Eyes" intelligence-sharing group — the United States, Australia and New Zealand — have banned the use of Huawei products in 5G network development based on fears the Chinese company could spy on behalf of China.
Federal Innovation Minister Navdeep Bains, who along with Public Safety Minister Ralph Goodale is responsible for overseeing the 5G security review, has said the analysis is not just about Huawei and is designed to assess how best to protect Canadians from all threats.
Bains finalized the Nokia deal Thursday in Davos, Switzerland, where he's participating in the World Economic Forum. Canada's scrutiny of Huawei has created concerns within the Chinese government. At the same time, Ottawa is locked in a diplomatic dispute with Beijing following Canada's December 1 arrest of Huawei executive Meng Wanzhou at the request of the United States.
