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We’ve got to tell this Chinese telco: My way or the Huawei

Michael Danby

by Michael Danby

04 Sep 05:35am

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Filed under: China, Malcolm Turnbull, Nbn, Telecommunications

45 comments

The shadow minister for communications, Malcolm Turnbull, says he will “review” the decision by Communications Minister Stephen Conroy to ban the Chinese company Huawei from bidding for work on the National Broadband Network. This is an irresponsible position to take when western intelligence agencies strongly suspect that Huawei operates as an agent of the Chinese Communist regime.

Chinese telco Huawei is raiding the Australian communications landscape. Pic: Kym Smith

Huawei claims to be a private company owned by its employees. In China, every enterprise with more than 50 employees must have a Communist Party cell, which has the legal power to “educate and supervise the company to ensure that it conducts its business lawfully and fulfils its social responsibilities.” This is particularly true in a “strategic sector” of the economy such as telecommunications.

Huawei as been officially described as a “national champion” in this field, which means that it is expected to act as an arm of the state to expand China’s role in the world telecoms industry. That’s why it has received up to US$30 billion in subsidies from China’s state controlled banks.

Huawei has close links to the Chinese military and intelligence services. Its founder, Ren Zhengfei, is a former military engineer. Its chairwoman, Sun Yafang, worked for the Communications Department of the Ministry of State Security before joining Huawei.

All this tells us that Huawei is a willing servant of the political, military and intelligence interests of the Chinese government and Communist Party. Associate Professor John Lee of the University of Sydney says: “Every large company operating in these strategic sectors is required to receive and implement political directives from the relevant ministries. In the case of telecommunications, the two most prominent would be the ministries of State Security and Commerce.”

The Ministry of State Security is the Chinese equivalent of the Soviet KGB. Would we have let a company controlled by the KGB install our national telephone system? Of course not. But that is what Mr Turnbull’s wish to “review” the government’s decision could lead to. His decision to “review” the Huawei ban is at odds with George Brandis, the Shadow Attourney General. Are the Coalition in turmoil? Is the China club of Turnbull, Julie Bishop and ex foreign Minister Alexander Downer trying to “wag the Coalition dog”?

The Coalition claims to support the US Alliance. But it is the government that is taking the same attitude to Huawei as President Obama’s administration, while Mr Turnbull wants to follow a hostile policy. Mr Turnbull’s fellow conservatives in the US Republican Party are even more adamant that allowing Huawei to buy into US telecoms companies would be a security risk. He should talk, as I have done, with Republican Congressman Mike Rogers, chair of the Congress’s Permanent Select Committee on Intelligence.

“I remain concerned about the national security threat posed by the potential expansion of Huawei into our telecommunications infrastructure,” Rogers said recently. “We must get to the bottom of these issues before they have further access to our market.”

The US has blocked several attempts by Huawei to buy into the US telecoms industry. The main reasons for this are:

•  the company’s suspected involvement in China’s campaign of hacking and other forms of cyberwarfare against the US government and US companies
•  the potential that Huawei products, once installed in a national telecoms system, could be used for both political and commercial espionage
•  the fact that Huawei has supplied equipment to Iran in violation of UN sanctions, including equipment that can be used for political repression.

In the UK, Huawei has been allowed to invest in the British telecoms network, but only under the very close supervision of GCHQ, the UK’s signals intelligence agency. Britain of course has no direct equivalent of our NBN. The NBN will be the central spine of our national telecoms system, and the prime target of any hacking or cyberwarfare attack on Australia, whether its motive is commercial or political.

This is not a trade issue. Unlike Tony Abbott I support Chinese businesses rights to invest in Australia. I have no objection to foreign investment by China, nor does the Australian Government.

But this is a national security issue. It’s madness to allow such a vital and sensitive part of our national infrastructure to be open to the influence of a company with well-documented links to the intelligence services of an authoritarian foreign country. Mr Turnbull should stop listening to his old cronies in the telecoms industry and the banks, who just want to make more money, and start thinking about our national security.

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45 comments

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    • acotrel says:

      05:47am | 04/09/12

      I always thought Malcolm was a mole ! How could anyone ever trust somebody who answers every email he gets ? He is obviously a plant - he even looks a bit bushy around the eyebrows.  I’d never vote for him, but he is leaps and bounds ahead of Abbott.

      Reply

    • Mr. Jordon says:

      06:35am | 04/09/12

      Agreed, it’s like when Howard gave our defence telecommunications contract to Optus. A company Marjority owned by the Singapore government. At the time Howard made this announcement the Singapore government was being accused of spying on Australia. 

      And now many of the Liberals are in bed with Huawei. Several ex-Liberals and ex- ALP MP’s are on its Australian board and current federal MP’s such as Julie Bishop have relieved overseas trips and gifts from the company.

      http://www.smh.com.au/it-pro/government-it/chinese-tech-giant-huawei-courts-mps-20120326-1vtnn.html#ixzz25ROzigeg


      “The register shows Huawei’s Australian arm sponsored trips by the opposition’s deputy leader Julie Bishop, finance spokesman Andrew Robb and frontbencher Bronwyn Bishop to China over the past eight months.”

      Reply

    • gabrianga says:

      08:05am | 04/09/12

      You are so selctive sweets.

      Remeber this?

      Bugging the Chinese Embassy in Canberra


      In 1995, the then Labor Federal Government was embarrassed by media revelations that its international espionage organisation had been spying on diplomats in Canberra by bugging the Chinese Embassy. In April 1995, the Federal Government tried to prevent publication of the story in the Sydney Morning Herald, first by persuasion, then by injunction.
      Executives at the Fairfax organisation claimed publication was in the national interest, in the same way that Foreign Minister Gareth Evans tried to insist that suppressing the story was also in the national interest (PANPA 1995d).
      On 25 May 1995, an item relating to the bugging of the Chinese Embassy by Phillip Williams was pulled from the ABC’s prime time evening television news bulletin, apparently after intervention by then managing director, Brian Johns.

    • wakeuppls says:

      08:17am | 04/09/12

      Regular public servants would get fired for accepting a bottle of wine from a company. I’d hate to see the result from a free trip.

    • Bazza says:

      08:38am | 04/09/12

      Mr Jordon….. Huawei are commies aren’t they?  Who was a commie at university. I think you got your commies mixed up

    • morrgo says:

      08:46am | 04/09/12

      Yep, the Chinese are even better in the old Commie trick of buying agents of influence than the Soviets were.  Also refer to Noel Fitzgibbon.

    • morrgo says:

      08:53am | 04/09/12

      Sorry, that should be Joel Fitzgibbon.

    • Mr. Jordon says:

      10:30am | 04/09/12

      @ gabrianga says: 08:05am | 04/09/12

      And did the ALP reward China for spying on us?

      Oh and if Fairfax know about it. Then there’s a pretty good chance the Australia’s intelligence agencies did as well.

      Tell me, what Australian intelligence operation in relation to China spying on us was compromised by the publication of this information?

    • Mr. Jordon says:

      10:35am | 04/09/12

      @Bazza

      Which explains why all election have been banned are why we now live in a police sate with APC’s on ever street corner.

      For crying out load, present an actual argument.

    • andye says:

      10:45am | 04/09/12

      @Bazza - “Mr Jordon….. Huawei are commies aren’t they?  Who was a commie at university. I think you got your commies mixed up”

      Did it hurt, squeezing out that thought?

    • Keith Hammersmith says:

      06:35am | 04/09/12

      so it is ok for us to sell the chinese metals and fuels etc,  thats ok, as it profits our economy a great deal, and of course the “evil” chinese will do nothing bad with said materials,  it is even ok for them to make all of our modern communication devices like tablets and smart phones, again thats ok because we like said items for low prices, 
      But low and behold when it comes to competitive pricing on other communications systems “we just do not trust the buggers”?

      seriously?  this much racism in the modern business world still?
      What a joke - especially towards one of our biggest business partners,  how insulting to them and makes us look like assholes..

      Reply

    • M says:

      07:53am | 04/09/12

      It’s not that they’re chinese that worries us, it’s that they’re dirty pinko commies.

      It’s a joke that you think this is about racism.

    • Daemon says:

      08:13am | 04/09/12

      Keith I have only two choices with your comment - either you have no clue about the technology, or you are really Alexander Downer.

      The technology inherent in the NBN is complex. Any engineer tasked with the following: “Create a chip which contains a spy, which will wake up in 10 years and begin transmitting everything that passes it, to the following IP Address”, would have little trouble doing it. I almost said it isn’t “rocket science”, but in fact, that’s exactly what it is.

      Apart from the issues of state support, which Huawei get to a point which we couldn’t even comprehend, the opportunity to spy at that level not taken up, would be dumb of the first order. Pricing shouldn’t even be part of it. They are already highly involved in our mobile network, and those of most of the world. Being able to turn that lot on or off, is what we are talking about.

      As for your bullshit use of the word “racism”, China could teach us a thing or two about racism, as could most of the rest of Asia. We just sold our biggest farm to them, lock, stock and barrel. Problematically, you “bottom liners”, only see your bank account as the end product and few of you seem to play chess. Try going to China, and buying a block of land big enough for a house… it won’t happen. Is that “racist”, or is it good common sense?

      As for “insulting” to the Chinese, are you serious? Try whinging at them about their highest number of judicial murders in the world. Try having a look at what they do to their own, when they live over here and go back there to do business. That’s insulting.

      China is the world’s factory, and that is as it should be for the moment. If you want insulting, try sending them designs for a mower so they can build it there. Their response - send us an actual one.. the designs were meaningless for them. Now that’s insulting to the 200 people who used to make them here. (All done by an accounting firm by the way who bought Rover Mowers).

      Please, Keith, leave the crocodile tears and hand-wringing at home. You are just another accountant bent on improving your bottom line. This isn’t about racism - it’s about your investments.

    • Dan says:

      09:09am | 04/09/12

      Fantastic comment Keith,

      We’re not going to be much in the Asian Century if we don’t get over our racism here.

      The US is the biggest investor in Australia (by a long way) and they have proven high-level links with the ALP - remember the Mark Arbib story?? They have been caught openly spying on almost every government in the world. Since the nationalisation of their banks, almost every company has “ties” with the US congress.

      See - you can do this stupid fear-based stuff with anyone!

    • bael says:

      09:23am | 04/09/12

      It has nothing to do with Racism. The chinese government is not the chinese people.

    • HC says:

      09:40am | 04/09/12

      I don’t think China cares what we think of them, we’re small fish and China would probably understand the caution, they’re not stupid and they know we’re not very stupid either (although at times I wonder).

      Also it has nothing to do with racism and everything to do with protecting our national security.  If this was a US company or even a Swiss or Canadian company with the same ties to their government’s intelligence agencies and the same reputation as Huawei’s, the intelligent and reasoned response would be to ban them from getting involved in our critical infrastructure projects too.

      But nice try to derail the conversation, business interests don’t trump national security interests, not if we want to remain a sovereign nation.

    • JC says:

      10:19am | 04/09/12

      How is this racism?

      Be they Chinese, Russian, New Zealanders, or Martians, if they’re known to engage in these activities then we should proceed with Caution.

      Go back to hugging trees.

    • M says:

      06:49am | 04/09/12

      It’s alright, Roxon is going to collect all the data. We’ll find out if they are up to something shady or not. Unless they use a TOR browser.

      Reply

    • Bazza says:

      10:38am | 04/09/12

      M…...... you won’t find any data if you are relying on Roxon to collect and keep it. Have you forgotten the data from the mid 90’s when she was lawyering at Blackburns, that appears to have gone down a big hole never to be seen again.

    • wakeuppls says:

      07:23am | 04/09/12

      Firstly, you’re an absolute idiot if you think every western country isn’t already being spied on by the Chinese government. Secondly, we already have so much god damn infrastructure in Australia already built by Huawei. We should be more worried about the Communists that control this country ALREADY rather than worry about some overseas.

      Reply

    • GC says:

      07:25am | 04/09/12

      At least the Chinese know how to competently build infrastructure without cost blowouts measured in the billions

      Reply

    • Trevor says:

      08:24am | 04/09/12

      You be tripping dude. Easy to make budget when the state has the power to raze villages at a whim. Check out the human cost of the three gorges project, but then again it’s only human capital that should be expendable? Harry Bechtel fan are we?

      Building empty cities so the economy can keep chugging? No, that’s going to end well…

    • Mack says:

      09:03am | 04/09/12

      Only their bridges and buildings keep collapsing, while their trains crash into each other.

    • Mahhrat says:

      07:29am | 04/09/12

      Interesting.  The mere fact that they’re trying so hard to be a part of all the Western telecom networks is itself cause for concern.

      The fact remains though that we shouldn’t need the help.  If we, with our economy, our culture and our nous, can’t build something like an NBN without taking such security risks, then that is to our everlasting shame.

      The mere fact this discussion needs to be had at all reinforces what Australia should already have been doing for the last 20 years - shifting our economy to the point where we are the ones providing that kind of service to the rest of the planet.

      Reply

    • jimbo says:

      08:11am | 04/09/12

      Conroy wants to keep the NBN cash flowing to his “Aussie Union Mates”.
      Turnbull would rather give the job to someone competent who will stick to budget.  Meanwhile, Swan is selling all our farms to the Chinese.  The whole thing smells of a sell-out to the Commies.
      Of course I could be a bit paranoid.

      Reply

    • watty says:

      08:15am | 04/09/12

      Presume Gillard and Conroy will now oppose sale of Cubbie as Chinese rumoured to be building undergroung missile bunkers ?

      What happened to the 500 Chinese spies rumoured to be housed in the Chinese Embassy when built about 1km from our Parliament?

      ps What secrets about Telephone technology could a Chinese company glean from Australia?

      Reply

    • Gomez12 says:

      02:15pm | 04/09/12

      Watty,

      It’s the secrets broadcast OVER the network that is of concern, not the technology OF the network itself. China already knows how fibre-optics work. They don’t yet have the credit card details of everyone in the country (for example).

    • Al says:

      08:24am | 04/09/12

      Why do people find it odd or even a concern when a company wants to invest and gain income from other buisnesses in the same industry globaly.
      One of the big reasons for this is to reduce the overall impact on profits etc when there are financial issues effecting specific regions on the globe (GFC anyone).
      If you have investment in areas that are and are not strongly effected by such an issue, it reduces the overall impact on your bottom line and reduces the likelyhood of the company failing.
      As for the spying issue, pffft. China already does, same as America and most other countries (whether they are military allies or not). Yet there is no concern when an American company wants to invest in Australia.

      Reply

    • ZSRenn says:

      08:50am | 04/09/12

      “Huawei claims to be a private company owned by its employees. In China, every enterprise with more than 50 employees must have a Communist Party cell, “

      Bullshit right here!

      I know of at least 50 companies with more than 50 employees which have no Communist Party Cell! While we have members of parliament sprouting more lies, and this seems typical of the Labor Party to gain whatever ends it seams fit, we will never have true debate on this subject.

      Reply

    • TheRealDave says:

      08:54am | 04/09/12

      I’m glad to see Huweii has evolved to sell some of its own products now…instead of ripped off Cisco knock off kdevices complete with actual pirated Cisco IOS installed on them….

      Great analogy in the article for the criminally slow. Huweii has and always will be riddled with Ministry of State Security people, its a fact of life in Communist China. Do we want a company like that building critical telecommunications infrastructure in this country? Infrastructure that will be used for the next 50 to 60 years. For ALL our communications needs. This is not just about ‘the internet’ or downloading tv shows. I know its a hard concept for some of you LNP supporters to get across since your leaders have told you that the NBN is only for porn and pirating movies and thinking for yourselves insn’t a strong point.

      Reply

    • The other Dave says:

      01:41pm | 04/09/12

      OMG @Dave - surely you aren’t suggesting that LNPe’ers aren’t able to think for themselves.. Goodness, does that mean they will re-spout what rAbbott says after he is instructed by George Pell? Surely you can’t be serious..

    • L. says:

      09:22am | 04/09/12

      So, it would be a choice between Huawei (Chinese), Cisco Systems (American) or Alcotel (French).

      I wonder just what links Cisco Systems have with the NSA

      I wonder just what liks Alcoltel have with the French version of the NSA.

      Lets face it, all compaines has their security ties.

      Anyone remember the Stuxnet worm that crippled the Iranian nuke development centrifuges..??

      It is widely believed that Seimens handed over the source code of the PLC’s that the Iranians were using to the Israelis and the Yanks so they could develop the worm.

      Kinda dmaned whomever we choose.

      Reply

    • Paranoid says:

      04:52pm | 04/09/12

      L, you forgot Skynet. And we all know what happened in that fiasco… or is about to happen…or did happen in the future…. or meant to happen if it wasn’t for Sarah Conner. I think. 
      But I digress, Australia should say no to Terminators!!

    • Bill Hust says:

      09:34am | 04/09/12

      Where does Mr Danby think the NBN is being built? Everything but some fibre and the satellites is built in China. Every piece of NBN equipment going into your house is built in China. By a company in a 50-50 joint venture with the Chinese Government. Before Mr Danby slams Huawei he should ask a few questions about the NBN equipment supplied by the imcumbent and i’s links to the Chinese Government.

      Reply

    • 007 lite says:

      10:16am | 04/09/12

      The Huawei scare is probably a campaign generated by our masters across the pond to protect their industry.
      Of course we can be the obedient Labrador and block Huawei.

      But remember China will than be able to retaliate and say block a Qantas route or some equivalent trade in a tit for tat skirmish. No one but you know who will win.

      I would love to see all the briefings that fed the story. The info is so good and clearly laid out that it smells like it has been fed by some competent propaganda agency.

      Reply

    • Doug says:

      10:19am | 04/09/12

      Oh, shock, horror!! A Chinese company is a front for the Chinese government/military/ruling party! Whoda thunk? Grow up people, we live in Asia, which is China’s backyard, we are China’s coal/iron mine, and we smugly assume we can live off sales to them without paying something back? Better to work closely with them than start waving the ‘yellow peril’ flag. If we were less lazy and developed industries here instead of being content to be a neo-colony flogging off our finite stock of raw materials, then you might have a case for whingeing. But as long as we’re content to be the new Nauru, we can hardly complain about changing from British to American and now Chinese masters. We made this bed and will have to lie in it.

      Reply

    • AdamC says:

      10:22am | 04/09/12

      I broadly agree with this. Every large corporation in China that deals in the ‘commanding heights’ of the economy is going to be, in some way or other, controlled or influenced by the Chinese state or the Communist Party itself. I suspect the likes of Turbull and Bishop are being a bit naive here.

      Reply

    • james says:

      11:44am | 04/09/12

      Or stupid or both.

    • M says:

      12:14pm | 04/09/12

      The chinese politiking fits perfectly with labor values atm. Censorship, data tracking, errosion of rights. Perhaps the Julia/communist thing hasn’t been taken very seriously.

    • wolf says:

      11:05am | 04/09/12

      So… no mention of companies like “Amdocs” and “Verint” who have been previously suspected of using their infrastructure to intercept communivations? Or is Mr Danby only worried about China in particular?

      Reply

    • DKC says:

      11:50am | 04/09/12

      China has clearly decided to project its growing power throughout the world - especially in its immediate Asia-Pacific region, but also significantly in Africa.  Its loans effectively underwrite the US economy ......... it is easing into a global “duopoly” with an uneasy US, and rolling back US influence in its traditional satellites (such as Australia) is part of its overall strategy.  To NOT see any Chinese corporate initiatives as an integral part of this government strategy is dangerously naive, and misunderstands the commanding role in Chinese society of the CCP and its three subsidiary mass organizations, the AC YF, the AC FTU and the PLA.  Every Chinese business person negotiating a “commercial” relationship with Australia will be a senior & trusted member of the CCP, the Youth Federation, the Federation of Trade Unions or the Army.  That has to be your starting assumption, otherwise we are innocents to the slaughter.

      Reply

    • RonaldR says:

      01:22pm | 04/09/12

      It’s time for you to all wake up about these politicians with a globalist agenda   they don’t serve you but their foreign advisors –IT ALL STARTED TO GO WRONG WHEN THE WHITLAM GOVERNMNET WAS SACKED and new information now available shows that Whitlam was sacked as he was going to privatise our resources to stop Australia being looted and it Kerr was just obeying orders from higher up.  At the same time there were plans being drawn up to loot Australia more and take away our Sovereignty and make us part of a Global financial   plan that would eventually tie in with Europe eventually turned into one country starting with one currency. Frazer was presented with the changes to ram through parliament but they were to radical for him –they already had 2 men that would see it through if Frazer failed please stand up Hawke & keating they were not going to let it fail they weakened the unions and then Keating was prime minister and started making the changes ,they were then carried on by Howard and the major parties are still run by these globalist and they not only stopped any talk of nationalizing resources they had most government services thrown open to privatisation   -Commonwealth Bank privatisation was part of deregulating our banks , The sale of Telstra and opening up our telecommunications to foreign companies & governments , then selling our farm land and residential to off shore owners and our prime farming land with the best water rights to foreign Governments for food production for their countries and at the same time attacking our growers in the Murray Darling Basin with harsh water restrictions -which will make a lot of those farms non viable as food producers.

      Reply

    • James says:

      05:36pm | 04/09/12

      Mr Danby,I have never voted ALP, If I were in your electorate I would vote for you.

      Both this article and your complete destruction of Lee “Brown” on the ABC make you my Labour hero.

      Reply
    • Tory Maguire

      Tory Maguire says:

      10:41am | 05/09/12

      This is a response from a spokesman from Huawei Technologies (Australia).

      Again Huawei has to respond to the ill-informed writings from the Member for Melbourne Ports, Mr Michael Danby. It is of much concern that these unsubstantiated conspiracy theories about Huawei come from a government member of the Parliamentary Joint Committee for Intelligence and Security currently examining telecommunications security.
      Huawei is a privately-owned global technology company that operates in over 150 countries. Our technology supports almost half the planet’s population. With so many customers across so many countries Huawei is one of the most scrutinized and monitored companies on the planet.  Seventy per cent of Huawei’s business comes from outside China and Huawei is now the world’s number one telecommunications infrastructure supplier.  Does Mr Danby think that the top global telecom operators don’t know what they are doing? Why would they risk their whole business operation by using a company they didn’t trust? You don’t get to do $30 billion worth of sales a year if people doubt your credentials. You don’t get to serve 45 of the top 50 global companies by being a risk.
      Over the past six years Huawei has been the sole supplier of key technology for the UK’s NBN and we have a very open and transparent relationship with the UK security agencies. The UK security agencies are recognised as the best in the world and over the period of the UK’s NBN rollout Huawei’s equipment and people have continued to win contracts to deliver services for this project.
      As a member of the government Mr Dandy well knows that equipment being supplied for the NBN in Australia is made in China, some by a Chinese Government joint venture. All major telecom vendors world-wide manufacture and have R&D facilities in China.
      Huawei has been in Australia since 2004, we employ over 900 people in Australia, eighty per cent of which are locals. We have a local board of directors who control our Australian business operations.
      Huawei’s high quality and affordable products and solutions are changing the way Australians do business and are keeping us connected for less. Fifty per cent of Australians already use at least one Huawei product for their telecommunications needs.
      Huawei continues to expand globally because its phenomenal investment in research and development ($5 Billion USD last year) is delivering groundbreaking products that are changing the digital world. Over the past five years Huawei has been one of the top companies with global patent applications. Mr Danby is determined to deny Australians the opportunity to benefit from Huawei’s vision and innovation.
      Cyber security is not a single country or company issue, all stakeholders – government and industry alike – need to recognise that cyber security is a shared global issue requiring international co-operation. Huawei stands ready and willing as a global leader in ICT to work with any government agency or department to ensure a safe and secure telecoms environment for Australia.  We are proud of the efforts of our local and global staff to ensure Australians have access to the best technology available, technology which is shaping our future prosperity.

      Reply
 
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