The New Zealand branch of telecommunications giant Huawei is in damage control as it vies to build a next-generation mobile phone network while contending with daily headlines about the global company's allegedly nefarious activities and ties to the Chinese state.
Photo: Shan he - Imaginechina/ AFP
Huawei and Spark have been blocked from building the 5G network in New Zealand after the government's spy agency, the Government Communication Security Bureau (GCSB), identified what it called a "significant network security risk" with the proposal.
In response, it is offering to open its systems to the government to allay national security concerns about the Chinese company's bid to build 5G here.
Huawei New Zealand deputy managing director Andrew Bowater said he still was not sure what the concerns were.
"It's become clear that there's global factors at play here in New Zealand that seem to be having an impact. But we've said all along that we'd welcome further engagement with the government here and believe that there are ways to mitigate any issues."
He said the company was willing to be transparent with the government and the GCSB and would do whatever it took to reassure them of Huawei's good intentions.
"They can park somebody with every installation if they'd like. The more engagement they want the better, from our perspective, because we have nothing to hide.
"We've opened ourselves up to more scrutiny than any other player in the market in the last few years and no evidence has ever been found. If there was evidence, I'm sure we'd be booted out of the country tomorrow."
Huawei willing to employ fewer Chinese staff in NZ
One of the concerns that's been raised is China's recently-introduced National Intelligence Law, designed to compel citizens or corporates to co-operate with Chinese intelligence.
Mr Bowater disputed the way the law has been interpreted outside of China but, nonetheless, reiterated his offer to mitigate any concern.
"If that meant limiting the number of Chinese staff that we have, if that resolves it, then fine, we're up for that.
"The key point is, we would like engagement with the government here."
However, geopolitical commentator Paul Buchanan, of the 36th Parallel consultancy, said having fewer Chinese staff did not address the use of the National Intelligence Law.
"What remains is the fact that the firm is duty-bound by this law to report things like intellectual property, copyright issues, advanced technologies to intelligence and securities in China."
Technology commentator Paul Spain of Gorilla Technology said the risk of the 5G network falling into the wrong hands could lead to information about callers being obtained, perhaps the content of calls, online communications, and internet data.
"They talk of data being the new oil and certainly there can be huge commercial benefit in having that information, as well as the other risks that are associated with having private information in hands that - maybe - can't be trusted."
The US Justice Department this week laid charges against Huawei, accusing the company and some top executives of stealing trade secrets, laundering money, obstructing justice and ignoring US sanctions against Iran.
China has rejected the latest charges, slamming them as "unfair and immoral" and urging the US to end the "unreasonable suppression" of Chinese businesses.
'There's going be tension one way or another.'
GCSB Minister Andrew Little said on Tuesday if New Zealand continued to block Huawei from the 5G project, it could be a blow to relations with China - our biggest trading partner.
Likewise, allowing China to build the network risks antagonising the US and other Five Eyes allies.
Photo: RNZ / Rebekah Parsons-King
"There's going be tension one way or another."
Asked about the latest charges laid in the US, Mr Little said they were just allegations and should not be accepted as fact.
"It's for Spark, who notified the GCSB that they want to use Huawei technology, to then decide whether or not they wish to continue with that proposal, or work with the GCSB on any mitigation, or to abandon it."
Spark could decide to push ahead with the Huawei arrangement despite the GCSB's position, in which case it would need to go before the minister, Mr Little said.
In a 13-count indictment filed in New York earlier this week, the US Justice Department said Huawei misled a global bank and US authorities about its relationship with subsidiaries Skycom Tech and Huawei Device USA Inc in order to conduct business in Iran.
In a separate case, the Justice Department also accused two Huawei subsidiaries of 10 counts of stealing trade secrets, wire fraud and obstructing justice for allegedly stealing robotic technology from carrier T-Mobile.
Huawei's chief financial officer Meng Wanzhou - who is also the daughter of Huawei's founder, Ren Zhengfei - was arrested in Canada in December and is now fighting extradition to the US.
- additional reporting by Reuters