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Huawei New Zealand deputy chief executive Andrew Bowater. Photo/Supplied

Why NZ may rue toeing the security line against Huawei

“It’s making political decisions around technical issues, and it’s not going to achieve much for the New Zealand economy,” says Huawei NZ deputy chief executive Andrew Bowater.

In New Zealand, Huawei remains blocked from building Spark’s 5G network, after the rejection by the Government Communications Security Bureau (GCSB) on national security grounds last December of Spark’s plan to use Huawei equipment.

Huawei New Zealand deputy chief executive Andrew Bowater sees his company’s success in New Zealand since it opened an office here in 2005 as being curtailed not by genuine security concerns but as a result of geopolitics.

“Nokia was approved almost overnight with a rubber stamp by the GCSB to do work with Vodafone. If you were to put our technology next to its, in terms of security risk, there’s minimal difference,” says Bowater.

“It’s making political decisions around technical issues, and it’s not going to achieve much for the New Zealand economy.”

Bowater sees strong business in maintaining existing 4G networks for Spark and 2degrees for five to seven more years, so doesn’t anticipate the significant redundancies that have been signalled for Huawei’s Australian operation.

Read more: The coming AI battle between China and the United States | AI's role in the mass-monitoring of behaviour in China

The Government has denied that blocking Huawei for 5G is New Zealand simply backing its Five Eyes partners. Canada is putting off a decision until after the federal election on October 21. A report outlining the UK Government’s decision on Huawei has been delayed as Brexit dominates the political agenda. However, some UK mobile operators have started using Huawei equipment for parts of their 5G networks.

The US deputy assistant secretary of state for cyber and international communications, Rob Strayer, told TVNZ last week that New Zealand would not be kicked out of Five Eyes if it allowed Huawei to build 5G networks here, but the US would reassess how it shared information with Wellington.

With 5G and artificial intelligence, which the company is increasingly building into its products, the US sees Huawei’s success in the tech world as a threat in itself. A US-China trade deal may prove Huawei’s salvation, but US President Donald Trump’s erratic flip-flops on trade with China offer no guarantees of that.

“Sorry, it’s the way I negotiate,” he told journalists at the G7 Summit in France last month. “It has done very well for me over the years. It’s doing even better for the country.”

Huawei can live with being banned from the US market for selling network equipment and mobile phones. It can probably wean itself off US technology in the next few years. But the US effort to contain it under the guise of national security has been mirrored by its allies. That threatens to crimp Huawei’s stellar run of growth. The question is, what are the implications should New Zealand be part of the blockade?

“If we don’t approve Huawei, we are screwing ourselves as the Asia-Pacific nation that we are becoming,” says China-based New Zealand investment adviser David Mahon.

“Whatever the result of this trade war, whatever phoney truce they come up with, China will never forget the price of the past two years.

“Our only path is the awkward and complex path of real independence and relative nonalignment.”

This article was first published in the September 28, 2019 issue of the New Zealand Listener.