SHANGHAI, Dec 11, 2018 (BSS/AFP) – China’s ambitious drive to dominate
next-generation 5G technology faces a sudden reality check as fears spread
that telecom companies like Huawei could be proxies for Beijing’s intrusive
security apparatus.
Fifth-generation mobile communications are the next milestone in the
digital revolution, bringing near-instantaneous connectivity and vast data
capacity.
They will enable the widespread adoption of futuristic technologies such as
artificial intelligence and automated cars and factories — advances China is
desperate to lead.
With 5G’s rollout expected to gain pace in coming years, the race to
dominate standards and control security and data traffic underpins much of
the current high-tech rivalry between the United States and China, technology
experts said.
Huawei’s status as a leading world supplier of the backbone equipment for
telecoms systems — mostly in developing markets — gives China an inside
track.
But analysts said mounting concern over Huawei imperils that lead.
“This is a big threat because if Huawei loses access to lucrative Western
markets, this will impact its ability to grow and finance R&D,” said Paul
Triolo, a global technology policy expert with risk consultancy Eurasia
Group.
It also could hinder the deployment of 5G networks in China, which are “a
key piece of China’s overall effort to upgrade its industrial base”, he
added.
The US defence establishment fears China’s dominance of critical 5G
infrastructure could enable it to disrupt American military communications or
otherwise wage asymmetrical warfare in a confrontation.
Triolo warned of potentially disastrous fallout for China if US law-
enforcement efforts — in the spotlight after the arrest of Huawei executive
Meng Wanzhou in Canada — result in a ban on sales of US chips and other
vital technology to Huawei.
“This could be catastrophic for China’s tech ambitions, threatening
(Huawei) itself, supporting industries, and future development,” he said.
– Burglar with a key –
New Zealand recently joined Australia and the US in essentially barring use
of Huawei equipment in domestic networks. Following Meng’s arrest on December
1, similar sentiments have arisen from Tokyo to Brussels.
On Monday, Kyodo news agency reported Japan’s top three telecom companies
would forego equipment from Huawei and another big Chinese player, ZTE.
US officials and lawmakers have long expressed concern that China could use
its tech firms to steal trade secrets — accusations Chinese foreign ministry
spokesman Lu Kang dismissed on Monday as “ridiculous.”
“These people do not provide a single (piece of) evidence to show how
Huawei affects their national security,” Lu said.
Distrust of Huawei stems in part from the background of founder Ren
Zhengfei, a 74-year-old former People’s Liberation Army engineer.
The US has already put the squeeze on ZTE, which faced insolvency earlier
this year after the Trump administration temporarily banned American
companies from selling it vital components.
Huawei has secured many leading 5G patents and supplied networking
equipment for telecom systems around the world that will inevitably carry
huge amounts of US data, putting that information at potential risk.
“One way to envision (the threat) is to imagine the person who built your
house decides to burgle it,” James Lewis, a technology policy expert at the
Center for Strategic and International Studies, wrote in an analysis last
week.
“They know the layout, power system, access points, (and) may have kept a
key.”
– ‘We don’t like it’ –
But US firms like Intel and Qualcomm produce the advanced chips critical
for 5G, giving Washington huge sway over Huawei, which depends heavily on
those technologies.
If the US cuts off Huawei’s chip supply and further isolates the company,
the blow “will be huge, bigger than ZTE”, said Shi Yinhong, an expert on
China-US relations at Beijing’s Renmin University.
“If Huawei is hit hard, China will lose its 5G lead.”
China observers say President Xi Jinping’s more assertive global stance
bears much of the blame for Huawei’s troubles.
Late leader Deng Xiaoping famously observed that China’s strategy should be
to “hide your strength, bide your time”, to avoid triggering a crippling
foreign backlash.
But Xi has dumped that, accumulating one-man power, scrapping term limits
and openly declaring China’s ambition to become a high-tech power.
Beijing also passed a law in 2015 obliging its corporations to aid the
government on matters of national security.
These moves have sparked alarm in the West, and the US has accused Chinese
entities of massive cyber-attacks.
“One of the biggest criticisms of Xi in China is: ‘did he take the stage
too fast, did he try to push Chinese power too soon?'” said Christopher
Balding, a China expert at Fulbright University in Saigon.
“He has behaved as near-totalitarian and is acting similarly
internationally and people are saying ‘we don’t like it.'”