Australia has cited the need to ward off foreign interference and risks of hacking and prohibited Chinese telecoms giant Huawei Technologies from being able to supply equipment in the building of new 5G networks across Australia.
Beijing has since responded, labeling the decision an “excuse” to get back at China as Australian security departments strongly suggested that it is in the country’s interests to reject the deal.
Allegations of Chinese interference in their Pacific neighbor’s politics have turned their relationship for the worse in recent years, with former Australian Prime Minister Tony Abbott choosing to go on a particular offensive. His successor Malcolm Turnbull had looked to welcome discussions to thaw working ties between the two countries, but his removal from leadership this week may well signal a change in direction back the other way.
Australia now appears to have hardened its stance against China and has followed a similar path to the US, where President Donald Trump put a block on Huawei and ZTE operating in the same market of creating networks. This came as part of a much wider series of ongoing trade disputes between China and the US.
The move surfaced in an emailed statement late on Thursday, which made clear that regulations of national security would now also be including equipment suppliers alongside telecom carriers.
Confirming the reasoning behind this action, the statement said that Australia is concerned about allowing suppliers to work on infrastructure that carries national importance when there is a chance of “extrajudicial directions from a foreign government” coming into play. Any opportunities to make the networks vulnerable are a serious security risk, and action therefore had to take place.
Huawei’s Australian channel responded to the ruling by actively denying that it was under any influence from Beijing and said on Twitter that the decision is “an extremely disappointing result for customers.”
China’s Foreign Ministry and Commerce Ministry both sent out messages relaying their concerns that national security does not seem like an appropriate reason for this action and cited the notion that this ruling could be discriminatory.
In a statement released through Foreign Ministry Spokesman Lu Kang, China called upon Australia to “abandon ideological prejudices and provide a fair environment for Chinese companies” and their ability to carry out operations in Australia.
Meanwhile, the Commerce Ministry said that the decision could easily have a negative effect on both Chinese and Australian companies and that this was not the right approach.
Under Chinese law, there are stipulations for all citizens and companies to comply with requests to cooperate with all intelligence work, and analysts have said that this opens up avenues for espionage.
John Watters, EVP and Chief Corporate Strategy Officer at FireEye Inc, a cybersecurity company, said that “the aligned strategy of a Chinese company with the Chinese government” made this inevitable.
Watters alleged that Australia would have to “spend more money to have more control over their national communication system” and added that this is what happens when a company such as Huawei would be able to “sacrifice near-term margin for long-term intelligence advantage.”
In recent months, Huawei received a ban from setting up Australia’s fiber-optic network as well as a range of submarine cables set in the Pacific.