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Huawei bad for business
Read more on - Polity | Economy | Schemes | S&T | Environment
- How Huawei came on scene: Over the last few years, the Chinese firm Huawei has become an unexpected symbol of technological threat, with the United States rallying allies to limit the company’s global scope. Although it is a private firm, Chinese law and Huawei’s extensive ties to the state have both raised sharp concerns. But while foreign-policy professionals have warned about the threats Huawei represents to national security and economic integrity, the exact nature and scope of such threats remain largely speculative.
- Genuinely risky: Available evidence suggests Huawei represents a serious risk not only to national security but also to commercial activities, as a report from the Netherlands confirmed. This is important not just for evaluating this one company but as a rubric to approach the threat stemming from the Chinese Communist Party’s techno-nationalist development strategies and its use of nominally private firms—to both national security and commercial enterprises. As the Biden administration prepares for “extreme competition” with China, the conflict over Huawei matters for national security, economic integrity, and supply chain security.
- Links with PLA: Although Huawei founder Ren Zhengfei acknowledges having served in China’s military as a deputy director (a technical rank inside the engineering corps) of the People’s Liberation Army (PLA), he adamantly denies that the Chinese government and the army were involved in the founding of his company. Officials who participated in Huawei’s early expansion tell a different story.
- Did he tell the truth: Ren’s rank may have been even higher: A 2012 report from the U.S. House of Representatives Intelligence Committee suggests he was a former director of the PLA General Staff Department’s Information Engineering Academy. That background would have meant he not only had the right experience and qualifications but also the right connections to become an integral part of a paradigm shift in China’s defense industry policy that began in the 1990s to simultaneously advance military and civilian digital, fiber-optics, satellite, microwave, and encrypted high-frequency radio technologies in what the Rand Corp. calls China’s “Digital Triangle” of defense procurement.
- The Digital Triangle: Its three vertices—China’s booming commercial information-technology companies, state research and development institute and funding infrastructure, and the PLA—were developed by techno-nationalist strategies with high-level bureaucratic coordination and significant state fiscal support. In other words, there is a strong possibility that Ren, either prior to the founding of Huawei or during the company’s early beginnings, was directed by Beijing to lead the civilian side of a “dual use” development strategy that would also supply the Chinese military with the latest telecommunications technologies. This wasn’t just a case of the revolving door between government or the military and the private sector that’s familiar elsewhere, in which Ren used his past position to form valuable contacts. Rather, it seems possible that Ren was recruited to develop R&D for the central government’s decadeslong effort to modernize China’s telecommunications for the defense industry.
- Uighurs: In 2020, Lawyers for Uyghur Rights argued, “Huawei plays an integral part in the systematic oppression of the Uyghur and other Turkic people in the Xinjiang Uyghur Autonomous Region … which amounts to crimes against humanity and a breach of jus cogens norms of international law.” Since then, reports have emerged that Huawei experimented with facial recognition artificial intelligence for ethnic profiling against the Uyghurs. Reports of forced labor exploited by Huawei are numerous and well documented. All this raises the risk of companies that do business with Huawei being caught up in the growing web of sanctions against Xinjiang officials and institutions.
- Summary: The risks of dealing with Huawei are not limited to national security or IT governance, risk management, and compliance. Rather, there are additional and broader risks to the global business community. Put differently, Huawei’s threats to open society are more comprehensive than previously thought.
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