The East Micronesia Cable project has stalled in the face of a global political stalemate. The project, which is led by the World Bank, decided not to award the contract to any of its three bidders.
EMC would connect Nauru, Kiribati, and the Federated States of Micronesia and would hook up with HANTRU-1 with access to Guam and beyond. Nauru is close to the US, Taiwan and Australia, Kiribati leans toward China, and the FSM has a defense agreement with the US. Alcatel Submarine Networks, NEC, and HMN Technologies (formerly Huawei Marine) were bidding for the contract. However, while HMN was coming in with a bid said to be 20% lower than its rivals, the US objected to the Chinese presence due to its interconnectivity with HANTRU-1.
HMN was formerly known as Huawei Marine, which was sold to Hengtong Optic-Electric Co Ltd a while back in order to separate it from Huawei and hopefully make it more palatable to international deals like this. The move does not seem to have worked very well on that front. The US government continues to warn against the company on the grounds that it will work with Chinese interests to spy on communications via the cable system.
Apparently, unable to keep HMN from winning on the merits of price and terms, all three bids were deemed ‘non-compliant’. And that means the cable currently has no path forward. Of course, politics being what they are, that could change. However the underlying disagreement looks like a stalemate in the near term.
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