cari_pb13_suntechtransfertelecomsouthafrica-bcb3c932c9c7de91.pdf

This policy brief analyzes the barriers to technology transfer from Chinese telecommunications equipment providers, specifically Huawei and ZTE, to South African companies. Based on fieldwork conducted in 2015, the author identifies three primary obstacles: the rise of managed services contracts, challenges regarding the legitimacy and professionalism of Chinese firms, and a weak institutional and regulatory framework in South Africa.

• The proliferation of managed services contracts (MSCs) hinders technology transfer by outsourcing maintenance and service work back to vendors. This shift reduces the deep forward and horizontal linkages that previously existed when engineers from both vendors and operators collaborated on long-term contracts, leaving operators to handle only the first layer of maintenance.
• Huawei and ZTE have gained market share in South Africa by offering price packages up to 50 percent lower than European competitors and providing more competitive vendor financing. This financing is supported by the Export-Import Bank of China and the China Development Bank, allowing these companies to use price as a primary market entry strategy.
• Technology transfer is impeded by 'contestations for legitimacy' rooted in cultural and language barriers. South African stakeholders have expressed concerns over the quality of Chinese equipment—though often unfounded—and perceived a lack of business professionalism, including the use of Chinese as a 'gatekeeping device' and a reluctance to share information.
• Local recruitment rates vary between the two Chinese firms, with Huawei's local recruitment at approximately 60 percent and ZTE's at about 40 percent. To combat trust issues and the 'Made in China' stigma, Huawei has exclusively employed South African trainers at its regional training center in northern Johannesburg.
• South Africa's institutional framework for ICT is described as weak, characterized by a lack of drive to prioritize ICT policy and an absence of enforced regulations for local content. The government has relied heavily on Broad-Based Black Economic Empowerment (BBBEE) laws, which the author argues focus more on compliance than transformative changes or stringent skills development.
• The author recommends that the South African government overhaul its regulatory environment by creating outcome-focused regulations for local skills development and content provision that go beyond BBBEE. Additionally, Huawei and ZTE are encouraged to decentralize recruitment and increase collaboration with local organizations to improve their legitimacy.

APA

South African Institute of International Affairs (n.d.). cari_pb13_suntechtransfertelecomsouthafrica-bcb3c932c9c7de91.pdf. https://saiia.org.za/wp-content/uploads/2022/08/CARI_PB13_SunTechTransferTelecomSouthAfrica.pdf

Chicago

South African Institute of International Affairs. cari_pb13_suntechtransfertelecomsouthafrica-bcb3c932c9c7de91.pdf. n.d. https://saiia.org.za/wp-content/uploads/2022/08/CARI_PB13_SunTechTransferTelecomSouthAfrica.pdf.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=cari_pb13_suntechtransfertelecomsouthafrica-bcb3c932c9c7de91.pdf |url=https://saiia.org.za/wp-content/uploads/2022/08/CARI_PB13_SunTechTransferTelecomSouthAfrica.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairsndcaripb13suntechtransfertelecomsouthafricabcb3c932c9c7de91pdf, author = {{South African Institute of International Affairs}}, title = {{cari\_pb13\_suntechtransfertelecomsouthafrica-bcb3c932c9c7de91.pdf}}, institution = {South African Institute of International Affairs}, url = {https://saiia.org.za/wp-content/uploads/2022/08/CARI_PB13_SunTechTransferTelecomSouthAfrica.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }