On Monday the US House of Representatives' Intelligence Committee urged the US government and US companies to avoid participating in any business with Huawei and ZTE. These Chinese telecoms companies pose a significant threat to national security warned the report of the committee’s findings. Today there has been a Chinese government reaction to the report calling the US accusations “groundless” and founded upon “subjective suspicions”.
Only a month ago we reported on HEXUS about Huawei Technologies investing heavily in the UK. The PM, David Cameron, heralded the investments saying that the UK is “open for business”. Meanwhile other countries such as the USA and Australia are very suspicious about Huawei (and ZTE). That Huawei was founded by an ex-PLA soldier doesn’t help matters. It was thought that the acceptance of Huawei’s purely business motives by wise UK politicians and GCHQ specialists might help with the acceptance of the company by the Americans. It seems not. The US committee is very fearful of espionage and cyber attacks which may be aided and abetted by Chinese networking gear.
Monday’s US Intelligence Committee report said “China has the means, opportunity, and motive to use telecommunications companies for malicious purposes”, reports the Guardian. The report also accused both Huawei and ZTE of “obstructionist behaviour” when researchers were investigating them. Both companies protested their innocence. Huawei said that it is a “globally trusted and respected company” and the US committee suggestions were baseless. ZTE also “profoundly disagrees” with the claims of the committee.
Today the Chinese government decided to wade into the debate. Shen Danyang, a spokesman for China's Commerce Ministry said “This report by the relevant committee of the U.S. Congress, based on subjective suspicions, no solid foundation and on the grounds of national security, has made groundless accusations against China” according to a Reuters report. The ministry is miffed that the Chinese companies will be prevented from going about their normal business in the US which is against the principle of fair competition.
Should the UK be more worried? Huawei is a major hardware supplier to BT and is providing a lot of the hardware for the infrastructure which will bring the first 4G network to the UK via Everything Everywhere.
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After seven years of working together, Cisco and ZTE have parted ways. Reports are that ZTE was supplying Cisco networking equipment to Iran, therefore breaking US sanctions.