Nokia and Ericsson, two of Europe’s biggest technology titans, are weighing drastic changes to their corporate structures, including setting up separate units in the Eastern and Western Hemispheres, in a bid to protect themselves against the escalating global trade war.

Both companies, which make equipment used to run 5G networks, have started drawing up emergency plans to move some of their most sensitive operations out of China and split up their supply chains to counter increasing national security concerns, sources have told The Sunday Telegraph.

It is one of the clearest indications yet that the decades-long process of globalisation, which has led to a boom in international trade and lowered the cost of goods and services, may be going into reverse due to protectionist policies.

European firms are concerned that it will become increasingly difficult to sell Chinese-made parts and software in the EU and the US, according to industry and government sources. Likewise, components made in the US or Europe could face more barriers from Beijing.

The companies are currently discussing different options. Nokia is considering setting up an EU-only operation for its 5G supply chain so that there can be no question of interference or security breaches resulting from its Chinese activities.