NEWS ANALYSIS
Canadians might remember Huawei as the main sponsor of Hockey Night in Canada’s Stanley Cup finals broadcasts. The Chinese telecommunications giant’s TV ads for the P20 Pro smartphone showcase a slick digital camera.Since 2008, Huawei has had a presence in Canada, but the country is playing a potentially dangerous game if it feels Huawei’s investment in its economy outweighs the national security risk.
The situation is very different from the attempted Chinese takeover of Aecon, which was blocked by the federal government based on national security grounds.
Huawei got funding from the Province of Ontario and has developed deep relationships with Canadian universities.
Huawei also supplies network equipment to Bell Canada and Telus.
For the consumer, U.S. intelligence agencies have cautioned against buying Huawei phones. The company has been accused of placing backdoors in its products, which can be used for espionage.
U.S. security experts believe the Chinese communist regime is seeking cutting-edge technologies to enhance its military capabilities through cyber spying, with Huawei as a front. The tough American stance against Huawei stands in stark contrast to other G7 countries, where the company is able to conduct business more freely.
Intelligence experts say the challenge for Canada is that it is difficult to find the guilty party in cyber spying and theft, despite the fact that there is plenty of circumstantial evidence, and when combined with the motivations of the Chinese communist regime, a smoking gun becomes clearer.
US Leadership
“Huawei has a very dubious past, starting with its founder who is a former military officer,” said Michel Juneau-Katsuya, former chief of Asia-Pacific for the Canadian Security Intelligence Service (CSIS), in a phone interview.Huawei founder Ren Zhengfei was a director of the People’s Liberation Army (PLA). The PLA is the attack force of the Chinese Communist Party; it’s not like a military force that just protects the public.
Brian Lee Crowley, managing director of the Macdonald-Laurier Institute, sounded a stern warning regarding Huawei building communications infrastructure in Canada.
“Who knows what surveillance or even sabotage functions might be built into such networks by a Chinese state that must consider that Western governments might eventually become potential or actual military adversaries,” he said in an editorial.
Now CEO of the NorthGate Group, a firm that performs threat and risk assessments for corporate clients, Juneau-Katsuya said Canada basically left it up to the private sector to decide if it wanted to do business with the Chinese telecommunications giant instead of taking the U.S. approach, which was to have its government warn its private sector of the risks of working with Huawei.
In fact, he said the Canadian tack “caused a great irritation to our American friends even before Mr. Trump came to power.” While the Trump administration has ramped up efforts to stop Chinese hacking, Huawei’s been under scrutiny in the United States for much longer.
Warnings about Chinese cyber spying haven’t been taken very seriously—both by Nortel and the Canadian government.
Questions About Ownership
“Huawei is a private company. Huawei is not an SOE [state-owned enterprise],” said Scott Bradley, Huawei Canada’s vice president of corporate affairs, in a phone interview.But many believe this is not truly the case.
The Epoch Times asked Bradley if there was no connection between Huawei and the communist regime in China. “Correct,” he responded.
But big Chinese companies—especially those involved in sensitive industries like telecommunications—are all subject to the objectives of the ruling communist regime, said Juneau-Katsuya.
The report’s authors also don’t believe Huawei’s U.S. subsidiaries operate independently of its Chinese headquarters. It would not be a stretch to assume a similar relationship exists for Canadian subsidiaries.
“Huawei and ZTE are cat’s paws for Chinese Communist Party domination, and we should treat them as such in every conceivable way,” said Richard Fisher, senior fellow with the International Assessment and Strategy Center, in a prior interview with The Epoch Times.
Nortel Gutted
Former employee Brian Shields was at the centre of Nortel’s efforts to combat Chinese hacking in the 2000s. He said he doesn’t have concrete proof that Huawei was behind the theft, but the pieces of the puzzle when put together strongly hints Huawei was involved.China wants to acquire cutting edge technologies and become a dominant player in telecom. Nortel was a major player, and after it went down, Huawei came to the fore.
“The [Chinese] government has every reason to ensure that Huawei was successful,” he said in a phone interview. “I don’t think we could have stopped them. They were basically a juggernaut with a government backing.”
Shields, now a cyber crime analyst with the U.S. Postal Service in North Carolina, recounts that Nortel executives didn’t do what was recommended to protect the company when first hacked. He estimated that the compromise lasted at least 10 years. Huawei was able to undercut Nortel with the intelligence it was gathering—technical papers, research reports, business plans, and employee emails. Nortel went bankrupt in 2009.
“The only one that would have benefited from the stuff that was stolen from us was a competitor. There’s no one else,” Shields said. “Circumstantial evidence is really strong … probably end up in the hands of Huawei or ZTE. You’re not just going to steal it and not do anything with it.”
The arrangement Huawei now has with Canadian universities bothers Shields.
As a communist nation, China is not incentivizing its citizens to come up with cutting-edge technology to stay ahead in an ever-escalating race. Shields said the Chinese are now trying to legitimize acquiring valuable IP through such arrangements with universities as opposed to stealing it outright.
As it stands now, there is a significant discrepancy between how it perceives Huawei and how the Unites States does.
