Dealing with the international China business phenomenon

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Dealing with the international China business phenomenon

Speaking on the latest Let’s Talk Huawei Morning Coffee webinar, Senior Lecturer in International Trade at the University of Adelaide, Mr Simon Lacey said nothing in Australia’s measure to ban Huawei from 5G actually did anything to increase or improve cyber security.

Mr Lacey said Australia and the United Kingdom both conducted telecommunications security reviews and came to very different conclusions.

“The UK seemed a lot more transparent, a lot more open and invited testimony and expertise from all points along the spectrum and came to the conclusion it was a risk that could be mitigated,” he said.

“Nationality-based bans don’t do anything to improve cyber security.”

He believed the economic impost of the Huawei 5G ban will be a burden on Australian telco operators and consumers and would not achieve any of the cyber security outcomes claimed. 

The UK, Germany and Korea have taken a very different approach to Huawei.

“Even if they have certain reservations about letting Chinese vendors into their market on just security grounds, they realise the importance of 5G coming into their market, particularly 5G and IoT. These are big manufacturing economies and they weren’t about to let the future of their manufacturing sectors be put at risk,” Mr Lacey said.

Mr Lacey argued the economic costs of ‘rip and replace’ policies being implemented in rural America and Australia are so huge that there needs to be a more open conversation.

“It’s just not good enough to say ‘it’s classified, we can’t share that information with you’, that’s just not good enough. We need to have an open conversation and have a more honest conversation about what the risks are versus what the benefits are. Today the more I read about cyber security the more I realise that it’s not about achieving security so much but about resilience. That’s what they talked a lot about in the UK process. It’s not about one vendor or one country, it’s about building the network in a way that it has resilience against different attack vectors or different bad actors whether and when they emerge.

And I think that something that hasn’t really been addressed when you just say we need to ban these guys because they’re from China, especially when so much of the eco-system is manufactured in China whether or not by Chinese companies. Nokia’s joint venture in China is a State-owned enterprise…much more state influenced than Huawei,” he said.

Mr Lacey went on to say the US Entity List had accelerated a process for China to become more autonomous and Australia needed the rules based order to protect its interests.

“The reality is China business is an international phenomenon,” he said.

“We are going to see greater fragmentation….Australia needs to walk the tightrope between our geopolitical interests in the US and our economic interests in China. Australia is a middle power, our interest is having a rules based system. We are not a hegemon. We can’t impose our will on the international community and we have to work within a system of rules.”

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