Wed, October 10, 2012
World > Americas > U.S. 2012 general election

Putting Huawei on hold, another Cold War legacy

2012-10-10 05:59:53 GMT2012-10-10 13:59:53(Beijing Time)

Sina English

As the global scenario tends to increasingly interdependent between powers, in particular, in terms of economy, the U.S. lawmakers, at cross purpose, are trying desperate to drive away the Chinese businesses, for nothing more than ideological differences, a mentality of Cold War legacy. An article published in The Economist: Putting Huawei on hold, just pinpoints this:

"Little more than an exercise in China bashing.” That is how a spokesman for Huawei has described a report published on October 8th by the Intelligence Committee of America’s House of Representatives, which has spent the past year looking into the activities of two of China’s biggest telecoms firms.

The report contains plenty of rhetoric about the supposed threats that Huawei and ZTE, the other Chinese company covered in it, pose to American security because of “their opaque governance structures and links to China’s Communist Party.” But it is oddly devoid of hard evidence to support its draconian recommendations.

Among other things, the committee’s report calls for any attempt by Huawei or ZTE to buy American companies to be blocked by a government body that is responsible for reviewing foreign purchases of American assets. It also says that the two firms’ telecoms-networking equipment and components should be excluded from government systems and those of private firms that work on them. And it wants to see an in-depth investigation into the financial support that the companies receive from the Chinese government.

If some of these recommendations are implemented, they could effectively stymie the Chinese firms’ attempts to expand in the world’s largest telecoms market and give a boost to rivals such as America’s Cisco and Sweden’s Ericsson. That explains why Huawei has been quick to hit back at the committee’s conclusions, arguing that it should not be “held hostage to geopolitical tensions” between governments.

The report itself fails to spell out any specific examples of the security risks that Huawei and ZTE pose, though it contains a “classified” section that supposedly contains instances in which Huawei’s employees “may be violating US laws”. At a press conference to launch the report, dark hints were dropped that the firm had been involved in things such as “beaconing”, or the illicit extraction and transfer of data, presumably with the goal of sending it on to China—a charge that Huawei firmly denies. The Chinese firm also gave warning that shutting it out of the American market would create a “monstrous, trade-distorting precedent”.

Indeed it would. As this newspaper has argued, knee-jerk techno-nationalism also makes no sense in an industry in which supply chains have become global. Most telecoms-equipment manufacturers now manufacture part or all of their kit in China and source components from the country.

So what is needed most is an international effort to develop standards governing the integrity and security of telecoms networks. Sadly, the House Intelligence Committee isn’t smart enough to see this.

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