By James Grubel
CANBERRA, Oct 24 (Reuters) – Chinese telecoms equipment firm
Huawei Technologies pledged on Wednesday to become more
transparent, proposing to set up a cyber-security centre in
Australia to help address concerns that threaten to shut it out
of key global markets.
Huawei, the world’s second-biggest telecoms equipment maker,
has been barred from a $38 billion project in Australia and is
also under siege by U.S. lawmakers who suspect it has close ties
to Beijing and that its equipment could be used for espionage.
“Huawei has done a very poor job of communicating about
ourselves and we must take full responsibility for that,” the
chairman of its Australian business, John Lord, told reporters
on Wednesday in what was a rare opportunity for international
media to quiz a senior Huawei figure on the security concerns.
“Huawei has a duty to set the record straight, to dispel the
myths and the misinformation,” the retired admiral told the
National Press Club in Canberra, denying there were any grounds
for governments to fear Huawei.
Lord said Huawei proposed to set up a centre in Australia to
give security-cleared officials complete access to its software
source code and equipment – similar to a centre it established
in Britain two years ago.
Huawei, the sole supplier of equipment for Britain’s
national broadband network, set up the UK centre with the
cooperation of the government, enabling Huawei’s hardware and
software to be tested to ensure against cyber security threats.
Huawei has also offered to undergo similar scrutiny in the
United States, along with another Chinese telecoms equipment
firm, ZTE Corp , the world’s fifth largest
telecom equipment maker.
However, a U.S. congressional intelligence committee has
decided any such efforts would likely fall short of addressing
security concerns, given the scale of the U.S. telecoms market,
and it called for Huawei and ZTE to be locked out of the market.
The committee’s report followed the Australian government’s
announcement this year that it had barred Huawei from
participating in its $38 billion high-speed broadband network.
Both those actions have in turn prompted Canada and Britain to
look deeper into similar issues.
Suspicions of Huawei are partly tied to its founder, Ren
Zhengfei, a former People’s Liberation Army officer. Huawei, an
employee-owned and unlisted company, denies any links with the
Chinese military and says it is a purely commercial enterprise.
It is the second-biggest maker of routers, switches and
telecom equipment by revenue after Sweden’s Ericsson,
but there is little public information about its operations.
HUAWEI LOOKS FOR LOCAL FACES
Lord, one of many influential figures hired by Huawei in
Western markets to reassure foreign governments, said the
company needed to do a better job to counter misperceptions.
“We sincerely hope that in Australia, we do not allow sober
debate on cyber security to become distorted the way it has in
the U.S.,” Lord said.
Asked why Huawei did not bring forward its stated plans for
a stock exchange listing in five to 10 years to appease concerns
about transparency, Lord said the firm’s focus was instead
localising the company’s boards and activities.
“Would listing be the panacea that would solve all of this
openness? At the moment the advice to us from experts outside of
Huawei is not necessarily so,” he said.
Huawei’s board in Australia, created last year, was the
company’s first local board with non-executive directors and
includes former foreign minister Alexander Downer and former
premier of Victoria state John Brumby.
“We’re developing a model and once that model is mature,
that model will be exported to other regions and countries
around the world, so that’s the first step of us moving out,”
Lord said.
Huawei CEO Ren, who founded the company 25 years ago after
he was laid off by the Chinese army, said during a visit to
Australia in August that the company would begin reinvesting
local profits back into the Australian market.
Huawei started in Australia in 2004 and has expanded its
business across Australia, New Zealand and the South Pacific.
It has become a significant market force in the region,
supplying equipment to Optus and Vodafone and conducting
trials with Telstra Corp Ltd.
Huawei Marine Networks, a joint venture between Huawei and
Britain’s Global Marine Systems, is involved in building two
telecommunications submarine cables between Australia and New
Zealand and between Australia and Singapore.
