US President Donald Trump’s worldwide campaign to blackball Huawei Technologies is looking like a failure.
Attempts to persuade other governments to exclude Huawei equipment from the next generation of super-fast mobile networks have hit a wall — even among close allies. So far, only a handful of countries, including Australia and Japan, have joined the US’ call to boycott the Chinese company.
Not a single European nation has done so, not even the UK, triggering a scolding from US Secretary of State Mike Pompeo in London on Wednesday.
Illustration: Yusha
“Now is the exact opposite time to go wobbly,” he said, invoking the famous locution that then-British prime minister Margaret Thatcher used to spur the US into sending troops to Kuwait after Iraq invaded it in 1990.
“Would she allow China to control the Internet of the future?” Pompeo added.
Huawei, meanwhile, is piling up record sales, forging into new markets, passing Apple as a phone maker and cementing its position as a leading global supplier of telecom gear.
Now, a newly confident Huawei is planning to rebuild its US presence after assuming a low profile the past few years. It put a seasoned insider, Joy Tan (譚喬伊), in charge of public affairs in the US, where it plans a print advertising campaign, amplified by social media, in coming months.
“It’s winning,” said Robert Spalding, a retired US Air Force brigadier general who was a strategist at the US National Security Council under Trump, and who has spoken out about the risks of letting China dominate new generation wireless technology.
The US does not seem able “to do anything that would fundamentally change things,” said Spalding, now a senior fellow at the Hudson Institute, a policy group.
Not for lack of trying. The US for the past year has sent diplomats around the globe to beseech other countries to shun Huawei.
Among the accusations, it says Huawei can build backdoors into its equipment, enabling spying by the Chinese government and posing a security risk for the 5G mobile networks that are to connect billions of devices, from autonomous cars to robot-rich factories and home refrigerators.
The US also says that Chinese law compels Huawei to cooperate with Beijing’s espionage agencies, and that Huawei has stolen other companies’ intellectual property.
At the US’ request, Canada has since December last year held Huawei chief financial officer Meng Wanzhou (孟晚舟) — the eldest daughter of its founder, Ren Zhengfei (任正非) — while the US seeks her extradition on charges of contravening Iran sanctions.
US Senator Mark Warner, a Democrat, on Thursday said that Huawei equipment was “extraordinarily dangerous,” especially with the arrival of 5G networks and the potential that undetectable malware could be uploaded at a future date, in addition to the company’s ties to the communist government.
Even telephone calls could be routed through China and information potentially collected by the Beijing government, he told reporters at a breakfast conversation.
“Most of our allies within the intelligence and security world realize this problem,” Warner said.
“I don’t think it’s too late” to stop Huawei’s advances in other countries, he said.
Also on Thursday, regulators rejected China Mobile’s bid to provide phone services in the US.
The US Federal Communications Commission cited national security concerns about the company controlled by Beijing, adding more friction to fraught trade relations between the world’s biggest economies.
US warnings have been considered by countries throughout Europe and Asia, but more often than not, brushed aside. The reasons are not hard to find.
Huawei’s gear is reliable, technologically advanced and less costly than its rivals’, said Joseph Franell, chief executive officer of Eastern Oregon Telecom, a rural service provider and early Huawei customer.
The Shenzhen-based company has said that governments and customers in 170 countries use its equipment, which poses no greater cybersecurity threat than that of any communications technology vendor.
Huawei’s rotating chairman, Guo Ping (郭平), said in a February opinion piece that the fusillade against Huawei results from Washington’s realization that the US has fallen behind in developing 5G technology, and has little to do with security.
The anti-Huawei campaign is playing out within a larger geopolitical struggle between the US and China that some liken to the Cold War between the Soviet Union and the US.
For Europe, the ongoing US-China trade dispute sharpens a conflict: The continent is trying to balance its close partnership with the US with a desire to increase business with China, its second-largest trading partner.
Trump’s most recent provocation — threatening to raise tariffs on US$200 billion worth of Chinese goods from 10 percent to 25 percent because trade talks are moving too slowly — further complicates matters.
The latest snag came at a two-day, 32-country meeting in Prague at the beginning of the month to set standards for 5G equipment.
Government officials presented a united front with a statement that warned against choosing suppliers that could be susceptible to state influence.
Yet behind the scenes, Germany, France and Austria sought changes, including that the statement’s title be switched from “principles” to the less stringent “proposals,” according to one Western official, to stress that the document would be non-binding.
US Deputy Assistant Secretary for Cyber and International Communications and Information Policy Robert Strayer, the US Department of State’s point person on Huawei, on Wednesday said that Europe had taken an important first step.
If rigorously applied, the Prague agreement could lead to the banning of Chinese companies, Strayer said, rejecting the notion that a lack of action so far against Huawei meant the US had lost the fight.
“While we have not seen bans on any particular company, I think that’s a little premature,” he said.
However, the Prague proposals might leave some European countries to adopt a two-tiered approach in which they exclude Huawei equipment from the core of their networks, where massive data flows, while allowing it to supply antennas and other parts for less-sensitive functions, Paul Triolo, an analyst at the Eurasia Group, said in an e-mail.
The UK is considering an approach similar to that for its 5G network, people familiar with the matter told Bloomberg last month.
The EU also stopped short of a ban, and has asked member states to assess the risk to their 5G network infrastructure and report back by mid-July.
Italy’s government has dismissed the US warnings as it seeks to increase trade with China, and German Chancellor Angela Merkel has said she opposes singling out an individual company to ban. Germany instead plans more stringent testing, oversight and approval guidelines that would apply to all vendors.
Throughout Europe, carriers are fighting threats of a Huawei ban, because they rely heavily on the supplier and believe they will fall behind the rest of the world on 5G if they are forced to abandon Huawei.
Even Vodafone stands behind Huawei after Bloomberg reported that Huawei software used in its Italian business had hidden backdoors, or paths to bypass security to access a computer system.
Huawei said the issues, found in 2011 and 2012, were resolved and that many other vendors used similar software to diagnose problems.
In the US, beyond the advertising campaign, the company is suing to overturn legislation that bars agencies, federal contractors and grant recipients from doing business with it.
Tan, who was Huawei president of global media and communication in Shenzhen and prepared the CEO for media interviews, took over the US media-relations operation, including its Washington office, in January.
“Blocking one company from the US market is not going to make the network secure,” Tan said in an interview, pointing to the global supply chain, which relies heavily on components made in China.
Huawei has worked with UK authorities to develop a third-party certification system to check for backdoors and other security risks, she said, adding that is the approach policymakers should adopt.
Tan has had trouble getting that point across in Washington, where the company scaled back operations less than a year ago.
Its government relations shop remains small, and one longtime lobbyist at an outside firm, APCO Worldwide executive director Don Bonker, stopped representing the company in March.
Huawei wants to reach out to congressional and administration policymakers, but “we don’t get too many meetings,” Tan said.
Huawei has added some high-powered talent, disclosures filed with the US Senate show.
Samir Jain, who served as senior director for cybersecurity policy on former US president Barack Obama’s National Security Council and is now with the Jones Day law firm, registered to lobby for the company in March.
That prompted a tweet from Trump criticizing the move.
“This is not good, or acceptable!” he wrote.
The company said that Jain would help with legal efforts and not lobby.
The treatment of Huawei contrasts with the Trump administration’s record on another Chinese telecommunications company labeled a security threat, ZTE.
Trump last year reversed a ban on US exports to ZTE that threatened to shutter the company, which the US said had contravened sanctions on Iran and North Korea.
Trump said that his reversal was a favor to Chinese President Xi Jinping (習近平) during trade talks, and that he had demanded the company take extra security steps, as well as pay a fine of more than US$1 billion.
Asian countries have been receptive to Huawei’s overtures or avoided making definitive public statements about a corporation that is feted by their giant Asian neighbor as a national champion.
Malaysian Prime Minister Mahathir Mohamad toured Huawei’s campus in April, where he expressed an interest in working with the Chinese company on artificial intelligence.
Thai officials in February hosted Huawei at the launch of a 5G trial facility, and Indonesia’s communications minister has played down concerns over the use of the Chinese company’s equipment.
The company’s financial performance shows no sign of retreat.
The privately held Huawei said its first-quarter sales rose 39 percent from a year earlier to US$26.8 billion.
The company posted net income of US$8.8 billion on US$106 billion in sales last year.
It overtook Apple to claim the No. 2 spot in global smartphone sales in the first quarter, second only to Samsung Electronics Co.
Shipments grew by 50 percent from a year earlier, market research firm International Data Corp said.
Huawei is expanding an already-large presence in Brazil by selling premium phones to consumers, a market it had not been in for five years.
In telecom equipment, its global market share last year rose to 29 percent, up from 20 percent five years earlier, according to Dell’Oro Group, a Redwood City, California, research firm.
“I don’t think our country has done a very good job of warning the rest of the world about what the danger of Huawei is, because I think if I’m Britain or Germany and know the facts, I can’t imagine allowing it in,” said US Senator Angus King, an independent from Maine who serves on the intelligence committee.
With Huawei gaining market share, financial strength and acceptance among the US’ closest allies, the score for now appears to be Trump 0, Huawei 1.
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