Australia’s biggest ‘China threat’ is not Huawei, but itself



This article is by Ken Shao, Director of the Chinese Law Program at Murdoch University. It originally appeared on The Conversation.

analysis In a move that has drawn criticism from Chinese authorities, the Abbott government is upholding a ban on Chinese telecommunications giant Huawei from tendering for the National Broadband Network, after receiving advice from national security agencies.

It’s best to leave the technological question of spying to the finest intelligence agents. What we should really learn from the Huawei ban is that the biggest threat to Australia’s future development is not Chinese firms such as Huawei, but Australia’s own poverty in high-tech capability, and in understanding China. Here are four key arguments for this:

First, the profound distrust of China’s current political regime needs to be reviewed.

Only last week the US was accused of spying on German Chancellor Angela Merkel. But espionage fears over this breaking news, as compared to those over China, can ease relatively quickly. It seems as if we still live with a Cold War mentality. We see little to rectify the institutional failures of the global financial crisis, while we are quite sceptical about the potential of China’s next stage of reform that is culturally backboned and aims to gain genuine trust.

This psychological effect can be best exemplified by a recent comment on Huawei made by Joshua Frydenberg, a parliamentary secretary to the Prime Minister and adviser on intelligence matters to the Howard government. Mr Frydenberg said that Australia should “do nothing that endangers the high level of intelligence cooperation that we currently enjoy with the US”.

But is there an alternative? Can the US, Australia and China work together for a better world for all?

Second, Australia’s poor understanding of China and its culture has pushed too much focus into political and ideological distrust. This has hindered the Australia-China economic relationship.

In repeated calls for a holistic perspective of China, I have cautioned that for over a century, the world has accumulated an excessive amount of plausible “China information” that needs to be replaced by the rarely available “China knowledge”. For instance, is guanxi (relationship) a Chinese value? Did China have no understanding of rule of law in its own tradition? Where is China’s current reform headed? The Cold War mentality has entirely different answers to these questions, but none of them are rooted in a holistic perspective of China. In many cases, misconceptions such as “fortune cookies” and “dragon emperors” are all we know.

Chinese business people are upset that wherever they go in developed countries, there is a suspicion of their communist “origin” or political “genes”. One way of changing this is to use improved understanding of Chinese business culture to help Chinese companies to comply with Australian conditions.

Third, the Huawei ban may affect current negotiations regarding the Free Trade Agreement between China and Australia, but there are many other difficulties facing both parties.

China wants to sell its technologies and alluring investment to Australia but there is an Australian national interest agenda that this sometimes conflicts with. Australia wants to export its financial services and food to China but these can be regarded as potential challenges to China’s financial and food securities, given the lessons learnt from the global financial crisis as well as China’s underlying policy that protects hundreds of millions of Chinese farmers.

The ultimate barrier is mutual trust. Hua Chunying, a spokeswoman for the Chinese Foreign Ministry, commented on the Huawei ban that: “We really hope that both sides could make an effort to create a level playing field for enterprises to carry out normal cooperation… on a basis of mutual respect, equality and mutual benefit.”

Such trust can only happen when Australia’s understanding of China is seriously improved.

Fourth, Australia needs to move away from a mining-centric focus and foresee both opportunities and challenges in China’s resurgent innovation economy, of which Huawei is an example.

Two weeks ago, when meeting with Governor Quentin Bryce in Beijing, China’s new Premier Li Keqiang attempted to sell China’s advanced high-speed rail technology to Australia. China already has a multi-layered, powerful national innovation system, while Australia doesn’t.

The Asian Century White Paper, recently dumped by the Abbott government, claimed that “by 2025, Australia will have an innovation system, in the top 10 globally”.

Our world economy is dominated by technology leaders, such as the US and Japan, and in the future, China. Australia is not among the leaders and a technologically competitive Australia is a must. It will offset the effects of the unsustainable, labour-based resource industry and benefit Australia on a higher level in the global value chain.

Facing China’s new rise, Australia should recognise two very urgent tasks: first, understanding China and its culture is the fundamental platform for Australia to establish mutual trust with China; and second, China is returning as a global innovation leader and Australia needs to dramatically improve its innovation competitiveness before it can gain strategic benefits from China’s future economy, which is to be knowledge-based.

Ken Shao does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations. This article was originally published at The Conversation. Read the original article.

Image credit: Huawei

The Conversation


  1. I am sitting here thinking naively that we could just revoke the ban and just never have Huawei win the selection process…..

  2. Here’s what the government’s Andrew Robb said, when the previous government banned Huawei from the NBN…

    “This looks to be the latest clumsy, offensive and unprofessional installment of a truly dysfunctional government.”

    He said the fact that former foreign minister Alexander Downer and former Victorian premier John Brumby were on Huawei’s Australian board, and that the company had a leading role in Britain’s telecommunications sector, warranted the government considering it with “clear eyes”.

    “We must bear in mind that this is a company which is heavily involved in eight of nine NBN roll-outs around the world,” Robb said.”

    If the boot fits Andrew…

    Seems like a post-election flip-flop…who would have thunk it eh?

  3. What if, hypothetically, Huawei had been found on multiple occasions to have been engaging in spying for the Chinese government.

    What if, hypothetically, it is not possible to publicly out Huawei, because of the diplomatic embarrassment of getting into a he said, she said spying game. (No doubt ASIO has dirty laundry too.)

    Instead, just prevent their involvement in national technology infrastructure projects without making a big scene about it.

    Makes sense, no?

  4. The only “issue” with Huawei is those nifty backdoors that the NSA use aren’t there with the technology developed in China, so the NSA can’t spy on us if NBN use Huawei.

    Political moves to keep American as an ally. About time we told the US where to go, like NZ did years ago.

    • Alcatel-Lucent is a French company, though. The French aren’t likely to roll over to the NSA and build back doors that affect the security of their products. Cisco perhaps. But I’m not aware of Cisco involvement in the NBN, which is surprising when they’re the global leader in every area of infrastructure networks. Being a US company I think it is actually unlikely there aren’t vulnerabilities built into Cisco equipment. Just as well they didn’t get the contract ;-)

  5. Daniel, you seem to be oblivious of all the other countries that have also banned Huawei from their major infrastructure projects – and they’re not all US allies

    lets not dumb down the debate to some form of infantile anti-americanism

    • @gerald,

      “We must bear in mind that this is a company which is heavily involved in eight of nine NBN roll-outs around the world,” Robb said.”

      This is what former opposition (now government minister – I believe) Andrew Robb said in 2012, when the then government banned Huawei.

    • @gerald

      What other countries have banned huawei?

      to the contrary most other countries are embracing huawei technology – as the article in the AFR pointed out

      Mr Robb said “we must bear in mind that this is a company which is heavily involved in eight of nine NBN roll-outs around the world.”

  6. Interesting article and having spent quite a bit of time in China I agree broadly with the arguments. I have my own collection of stories that demonstrate the difference in cultures. China is fascinating and at times crazy as the weight of numbers take on a force of its own. I agree totally that the fears of China are overblown and do more damage than the actual differences underlying the suspicions.

    One of the things that is difficult to do as an entity made up of so many parts is provide a consistent front to everybody else. China has changed so much in the last 30-40 years and it needs to mature and demonstrate how it is going to behave in the world. I think the practical reality is that China on the whole is quite considerate of other nations (and becoming more so) but then there are always things that make you wonder. The revision of history and geography is at times baffling and quite concerning to some of its neighbours who are left wondering as to its intent. With Taiwan, there is a practical reality which I think most people would be happy with but then you get the crazy talk in the background and things like the brigade of women trained specifically to marry Taiwanese war veterans and accelerate their deaths while repatriating their pensions. Some of my personal experiences are up there with that kind of crazy.

    One of the frustrations I know the Chinese feel is that when they make mistakes, it is held against them for quite some time by other developed countries and yet those countries are guilty of equal or more blatant hypocrisy.

    From my experience, make the effort to get to know them and you will have a lot of fun. I wonder if that can translate to the relations between governments?

  7. RBH, My family are chinese and I don’t recognise half the behaviour that you desribe.
    If you want to talk about holding grudges then you’re not looking too hard at mainnland chinese

    I lived in Taiwan when it was still under martial law, and they can be just as insular as mainlanders

    If anyone thinks that the chinese are benign then they’re reading too many enid blyton books. At the humint level they make the US look like beginners

    What is farcical is the hand wringing over US INT services, every country does it – and they’re all thinking “there but for the grace of god go I”

    Chinas changted dramatically since 1985 – but the core behaviour of govt policy has not changed. Its not some magical fairy land despite all the willingness of business to trade their moral compass in the quest for a piece of the pie.

    No offence, but unless you are chinese, then it doesn’t matter how long a westerner has done business with them – they always withhold their innermost views

    there are mainland prices, there are chinese prices, there are asian prices, and then there are foreigners – and depdending which foreign culture you come from dictates how they will shift the financial benefit in trade.

    the notion that china is nothing more than a geographical panda bear that is misunderstood is abject nonsense. they have no consideration of other nations outside of the need to get ahead and regain their place – as much of central africa has discovered when the chinese came bearing gifts.

    I wouldn’t trust mainlanders with a 10 foot pole – and their never ending persecution complex and sense of retribution vis a vis entitlement is deep and long lasting. Hell I can’t even go home without me or my relatives being followed – and I’m not even a round eye.

  8. I’d echo RBH’s comments over yours gerald, I spent a while in China recently and came back with a very positive experience. Suggest it is yourself, possibly influenced by your parent bad experience which influences your view of china, and does not reflect todays reality.

  9. China remains a police state and a totalitarian dictatorship. The political system there is deeply antithetical to ours, characterized by heavy state interference in commercial and personal activities. Why on earth should we not be suspicious of companies that can be shut down at any time if they anger the Party?

    The US is not covering itself in glory at the moment, but at least they have some sort of commitment to democracy, freedom and the rule of law.

    • I don’t think commitment is the right word. Lip-service is closer to it. Most governments are the same, China just surveills and controls its population more overtly than most, while the rest do it more covertly. I guess the other major difference between the US and China is that in China the government controls the corporations, and not the other way around. The world sucks.

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