When the government back in July signed a Memorandum of Understanding with Chinese telecommunications giant Huawei, many scoffed, ridiculed and brushed off the concept as another lame duck government public relations exercise.

But despite the fact that the initial capital outlay being pumped into its Malta outfit is rather minimal considering the fact that the company invested a whopping US$5 billion in research and development in 2013, the investment's potential is certainly nothing to be scoffed at.

Last July the Maltese government and the Chinese telecoms company, the world's largest, signed an agreement that will see the company open an office at SmartCity and begin research and development activities in Malta.

Specifically, the company has agreed to test its avant-garde 5G mobile technology in Malta and in so doing it will seek to rope in a local partner, presumably one of the country's own telecommunications companies, to test the incredibly promising technology.

Granted, this may be old news but the crux of the matter lies in the fact that the government, by jumping into 'test bed' with Huawei, could very well have launched a pre-emptive strike in the battle to come over the Internet of Things.

The Maltese government had - through foresight, pure blind luck or a combination of both - sealed a 5G partnership with China's largest telecommunications company just before the European Union itself signed a 5G partnership with China.

As a result, Malta has managed to place itself in pole position in the EU-China race for 5G and the Internet of Things.

The EU-China agreement provides for five key elements: to reach a global understanding, by the end of 2015, on the concept, basic functionalities, key technologies and time plan for 5G; to explore possibilities in cooperating and implementing joint research actions in the area of 5G and to facilitate bilateral participation of enterprises in 5G research projects in China and the EU; to jointly promote global standardisation for 5G, in support of ongoing standardisation work in relevant organisations such as the 3rd Generation Partnership Project and the International Telecommunication Union; to cooperate in facilitating the identification of the most promising radio frequency bands to meet the new spectrum requirements for 5G; and to jointly explore the possibilities for cooperative research on the services and applications for 5G, especially in the area of the Internet of Things.

It is true that Huawei's Malta office will be a small operation, with just a handful of staff being deployed here, but in today's day and age, the size of an operation does not, by any means, define its value or its potential. 

Huawei is one of the world's most R&D-intensive companies and some 46% of its 146,000 employees around the world are engaged in R&D. The company also has 21 R&D institutes in countries ranging from China to the US, from the UK to Columbia and from India to Russia.

And this is exactly the direction in which successive governments have been trying, with mixed results, to take the country - into the knowledge economy, in which R&D plays a significant role.  This is the area where Malta, given its spatial constraints and its comparatively high wages, can truly excel.

By having chosen Malta to serve as a test bed for the development of its 5G technology, Huawei has also opened up the possibility of the country becoming one of the most technologically-advanced nations on Earth.

With the world's largest telecommunications company, which also has one of the world's largest R&D setups, using Malta as a test bed for the world's newest and potentially redefining communications technology, Malta could very well end up as one of the first countries in the world to have a rolled out 5G telecommunications network. 

The test bed concept applies perfectly to Malta: a small country with a small market with a significant thirst for all things ICT.

This is a small investment but the prospect of 5G network eventually being rolled out in Malta before other countries is enormous.   As such, it was no coincidence Malta Gaming Authority chairperson Joe Cuschieri was chosen to consult on the deal - Malta's remote gaming sector stands to gain considerably from a potential advent of 5G technology in the country.

5G technology is meant to open up the still largely fictional 'internet of things', in which devices with embedded electronics - from fridges and air conditioners and from heart monitoring implants to cars with built-in sensors - will be able to be controlled or accessed remotely.  The opportunities are virtually endless, and if Malta were to be one of the first countries with such a network, the country's potential is also limitless.

Yes, Malta could potentially become one of the world's most advanced telecommunications countries, but then again this may all be another pie in the sky. All that has been signed, in reality, was a memorandum of understanding, which, after all, does not exactly bind the Chinese multinational to turn Malta into a showcase for 5G technology.  And even if it does, there is absolutely no guarantee that Huawei will be either the frontrunners or the pioneers in the technology's rollout.

Much remains to be seen of this new Chinese investment but it was patently unwise for anyone to have to immediately written it off as another case of mere government hyperbole.

And much more also remains to be seen of the EU-China 5G agreement, and how that will play out for Malta and its Huawei partnership for that matter.