ZTE, Huawei participate in Peru 5G rollout

Peru is tapping potential of Chinese companies to continue building out the country's 5G infrastructure. In the latest move, Peruvian operator Bitel partnered with Chinese tech giant ZTE in a $150 million investment to deploy 1,000 5G antennas across the country.

As part of the deal, ZTE — which is headquartered in Shenzhen in the southern Chinese province of Guangdong — will provide advanced baseband units and AWS/B40 band equipment that will facilitate high-speed, low-latency connectivity in busy city and industrial areas in Peru.

The South American country has set its sights on accelerating the deployment of 4G infrastructure while simultaneously preparing for nationwide 5G deployment.

"Vendors like ZTE and Huawei offer infrastructure solutions with more affordable prices and financing than their Western competitors," said Giovanna Carbajal Morris, CEO of Magio Group, a technology-focused consulting firm in Peru. "China's expertise in massive network rollouts has helped speed up Peru's telecom modernization."

A desire to diversify technology suppliers drives Peru's strategy to work with China on digital innovation. Peru's partnership with Chinese companies is likely to speed up the rollout of 5G, Morris said.

"Although Chinese technology makes up most of Peru's telecom infrastructure, the government wants to balance between different providers to mitigate risks of technological dependence," she said.

"Chinese companies are chosen for development because they are increasingly competitive," said Ernest Cuadros-Vargas, a computer scientist and former dean of the School of Engineering at San Ignacio de Loyola University. "They provide modern competitiveness at a more accessible price."

"By 2025, I hope that with the opening of the port of Chancay there will be a new direct fiber optic connection to Asia that will accelerate the country's international communications," said Cuadros-Vargas.

Internally, it would be very interesting to have fiber optic networks in the form of a mesh on the highlands and jungle coast with direct connection to our neighbors such as Brazil, Colombia or Bolivia, Cuadros-Vargas told this correspondent.

"Chinese investment could help by connecting Peru to Oceania and directly to Asia through the Pacific Ocean," Cuadros-Vargas said.

Vietnamese telecom company Viettel Group, which owns Bitel, sees benefits in the partnership for its internet services.

"We are confident that ZTE will continue to provide strong support, not just for our operations in Peru but across our branches in Vietnam and other global markets," said Tao Duc Thang, CEO of Viettel Group.

Huawei has also inked partnerships with other Peruvian telecom companies, including Claro and Entel. Claro and Huawei worked together on AI-powered network management to improve network service availability and quality in Peru.

Meanwhile, Entel Peru made history as the first operator outside China to implement Huawei's 2.3GHz+3.5GHz dual-band AAU in a commercial 5G network, aiming for a 30 percent boost in network coverage.

The China-Peru trade relationship extends beyond telecommunications. China is a major supplier of electronics to Peru, with main exports including broadcasting equipment, computers and cars. China's exports to Peru reached $15.1 billion in 2022.

The Peruvian government actively supports telecom development through various laws and programs. For example, favorable spectrum allocation rules and regulations are in place to help companies grow their networks.

Through its National Telecommunications Program (Pronatel), the government funds infrastructure in hard-to-reach areas, bridging the digital divide and supplementing private investment. Morris said that new regulations are being introduced to support 5G adoption and advance technologies like the Internet of Things (IoT), artificial intelligence (AI) and smart grids.

The government has created public-private partnerships to speed up internet access upgrades. Under these arrangements, the government provides access to spectrum and land for installing antennas, while private companies fund the technology and network setup, noted Morris, the Magio Group CEO.

"Major providers like Bitel, Claro, Entel and Movistar have signed agreements with international technology companies, working in line with government plans," said Morris.

Internet services in Peru remain regulated by the Ministry of Transport and Communications (MTC) and the Supervisory Body for Private Investment in Telecommunications, which oversees service quality and cybersecurity compliance.

In 2019, Peru launched a National Infrastructure Plan to address a $110 billion infrastructure gap across water, healthcare and telecommunications. The plan prioritizes over 52 projects worth $28.5 billion, set for completion by 2025.

Internet access in Peru has grown dramatically, from under 20 percent of the population in 2012 to over 76 percent in 2023, according to the International Trade Administration, an agency under the United States Department of Commerce.

And Peru is now looking to expand 5G coverage across its main cities, aiming to reach 60 percent of urban residents by 2025, said Morris.

"Peru hopes to bring in more than $500 million for digital infrastructure investments in the next two years," she said.

The writer is a freelance journalist for China Daily.