Why Huaweiar­rest caused a sen­sa­tion

Irish Independent - - Focus Business - Gavin McLough­lin

THE high pro­file ar­rest in Canada of Meng Wanzhou, Huawei Tech­nolo­gies’ chief fi­nan­cial of­fi­cer and daugh­ter of the founder of the Chi­nese tele­com’s gi­ant, rocked mar­kets this week.

The ar­rest at the re­quest of the US – re­port­edly for al­leged vi­o­la­tions of US sanc­tions against Iran – caused out­rage in China, which called for her im­me­di­ate re­lease.

In much of the world, the case has fo­cused de­bate on Huawei and whether its links to the Chi­nese gov­ern­ment and role in po­ten­tially sen­si­tive data and com­mu­ni­ca­tions flows poses a se­cu­rity threat.

In the UK BT pulled Huawei equip­ment from the core of a Bri­tish mo­bile net­work this week, while the US, Aus­tralia and New Zealand, whose na­tional se­cu­rity ser­vices share in­tel­li­gence, have banned Huawei from pro­vid­ing 5G equip­ment. The head of Bri­tain’s MI6 said this week the UK must de­cide whether to fol­low suit.

There are no re­stric­tions in Ar­rested CFO Meng Wanzhou

Ire­land and nei­ther the Depart­ment of Com­mu­ni­ca­tions nor Com­Reg, the reg­u­la­tor, would com­ment on whether they have con­cerns.

Huawei is ac­tive here. It is work­ing with Eir on rolling out a mo­bile net­work, pro­vid­ing equip­ment de­signed to pro­vide the link be­tween phones and the so-called core net­work, which is be­ing pro­vided by Eric­s­son.

Siro – owned by ESB and Voda­fone – also signed a deal with Huawei to work on a fi­bre broad­band pro­ject.

Eir told the Ir­ish In­de­pen­dent that the se­cu­rity of its net­work is “para­mount” but it has no con­cerns about work­ing with Huawei. “We would not have se­lected Huawei if we be­lieved there was any risk for our cus­tomers,” a spokesman said. Siro de­clined to com­ment. Mean­while, Meng Wanzhou’s ar­rest has big im­pli­ca­tions, com­ing at a sen­si­tive time in US-China trade talks. Huawei is one of China’s most iconic brands and the key to Pres­i­dent Xi Jin­ping’s plans to dom­i­nate new tech­nolo­gies such as 5G net­works.

“The de­ten­tion of Huawei’s CFO is not an ac­ci­den­tal in­ci­dent and will cast a shadow over the trade talks, but both sides will work hard to avert that bad in­flu­ence,” said Wei Jian­guo, for­mer vice minister of com­merce and now a vice chair­man of the China Cen­tre for In­ter­na­tional Eco­nomic Ex­changes.

“The ne­go­ti­a­tion be­tween Chi­nese and US work­ing groups is go­ing smoothly, and ac­tu­ally much bet­ter than peo­ple out­side ex­pected.”

On the other hand, bu­reau­crats who were more in­volved with na­tional se­cu­rity view things dif­fer­ently. In their eyes, Xi caved too much and ended up look­ing weak to the pub­lic. The Huawei ar­rest was just an­other tac­tic by the US to gain even more lever­age, they say, and China should fight back with mea­sures that hurt Amer­i­can com­pa­nies.

One of­fi­cial men­tioned be­ing per­son­ally an­gry be­cause Huawei is a point of na­tional pride for the Chi­nese peo­ple, and keep­ing the is­sue sep­a­rate from trade talks with the US would be dif­fi­cult even if top lead­ers wanted to.

Chi­nese of­fi­cials have rea­son to worry about a pub­lic back­lash. In the 1990s, Premier Zhu Rongji was crit­i­cised by an in­creas­ingly na­tion­al­ist pub­lic af­ter re­turn­ing empty handed from trade talks with the Clin­ton ad­min­is­tra­tion.

Pub­licly, at least, China is keep­ing the is­sues sep­a­rate.

It’s un­clear if China will take a more fer­vent stance now that Xi has ar­rived back in Bei­jing.

For sev­eral days af­ter his meet­ing with Trump, the bu­reau­cracy was stuck wait­ing for him to re­turn, un­cer­tain of what ex­actly was de­cided dur­ing his meet­ing with Mr Trump at the G20 in Ar­gentina.

Huawei is work­ing with Eir on rolling out a mo­bile net­work


In­ter­na­tional at­ten­tion: Mem­bers of the me­dia out­side the BC Supreme Court bail hear­ing of Huawei CFO Meng Wanzhou yesterday, who was held on an ex­tra­di­tion war­rant in Van­cou­ver

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