Huawei vs Five Eyes: NZ diplomatic ties at centre of dilemma

10:31 am on 29 November 2018

By Paul G. Buchanan*

Opinion - The Government Communications Security Bureau's (GCSB) decision to recommend against using Huawei equipment for the 5G rollout because of national security concerns underscores the strategic role commercial telecommunications plays in modern society.

Huawei logo.

The GCSB has turned down Spark's proposed use of Huawei equipment in its new 5G network, citing national security risks. Photo: AFP

It also exposes the disconnect between local telecommunications providers and the Five Eyes signals intelligence network, as well as that between career intelligence professionals and the politicians who oversee them.

The GCSB decision was expected once telecommunications firms informed the GCSB months ago that they wanted to utilise Huawei equipment as part of the 5G network upgrade.

Under the Telecommunications Interception, Communications and Security Act 2013 (TICSA) telecommunications firms must request authorisation from the GCSB for upgrades to their networks regardless of provider.

The GCSB vetting process took a delicate turn in light of a US request that its Five Eyes partners refuse to allow Huawei participation in their 5G upgrades, citing the high likelihood that Huawei equipment could be used for Chinese intelligence purposes.

That is particularly true for equipment embedded in the "core" of a 5G network, as opposed to the periphery where Huawei used to operate, because it is now possible under the 5G plan for New Zealand for some previously "core" features to migrate to peripheral parts of the network for the purposes of speeding up data flows.

The telecommunications industry sees Huawei as a good choice as a 5G provider because of its positive impact on systems efficiency and profitability.

The GCSB and its Five Eyes partners see Huawei equipment as a Trojan Horse into the local telecommunication infrastructure.

The former outlined their preferences based on their financial bottom lines. The latter have technical as well as diplomatic justifications for opposing approval on national security grounds.

Huawei is seen by the Five Eyes partners as an untrustworthy commercial operator that serves as a front for Chinese signals intelligence gathering.

Diplomatically, it would be very difficult for the GCSB to green light Huawei's involvement in the 5G upgrade in the face of the US request to withhold approval, especially if the other Five Eyes partners (Australia, Canada and the UK) agree to the US request (Australia already has and Canada and the UK are said to be leaning towards agreement).

The fallout from such a decision could open a rift within the Five Eyes partnership because New Zealand is already seen as the Achilles Heel of the network given its past record of poor cyber security awareness (say, in the overlap between professional and personal communications).

It is therefore prudent for the GCSB to side with the US on the matter.

Besides reassuring its allies, the GCSB decision also signals to the Chinese government that it is not, in fact, the weak link in the Anglophone intelligence network.

For their part, the Chinese need to be careful with their response to the adverse decision, as any retaliation will give the lie to their claims that Huawei is independent of the regime and support those who argued against Huawei's 5G involvement in the first place.

The GCSB decision comes in wake of the Minister of Intelligence and Security, Andrew Little, declaring as recently as a few days ago that New Zealand would be independent in making its decision about approval.

It also demonstrates a disconnect between the minister and the career intelligence professional who serve under him, since it is doubtful that the latter would have led Mr Little to believe that the matter of approval was open to negotiation.

To be sure, Mr Little needed to factor the commercial considerations at stake as well as the diplomatic fallout with China once approval was rejected, but his dissembling was unfortunate.

In the end, security and diplomatic concerns involving New Zealand's Anglophone allies outweighed market considerations and the potentially negative reaction of the Chinese government to the decision.

The decision may be a cost-effective as well, since the blanket ban on Huawei's involvement in the 5G upgrade eliminates the possibility that the GCSB will be spending time and resources in the future trying to plug potential vulnerabilities brought into the system under false pretenses (as the UK had to do with a previous generation of Huawei products).

*Paul G. Buchanan is the director of 36th Parallel Assessments, a geopolitical and strategic analysis consultancy based in Auckland.

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