In Huawei battle, signs of US decline

Last year, US intelligence services convinced a group of allies in quick succession to ostracize Chinese telecommunications firms. Australia, New Zealand and Japan all effectively banned the world’s largest telecoms equipment maker, China’s Huawei.

But the campaign has stalled in Europe. Not a single European country has unveiled measures that would ban gear from Huawei – or ZTE, China’s fellow telecoms national champion.

Germany, a key NATO ally of the United States, went as far as to tell the press last week that they do not seek to ban Huawei, despite Washington’s insistence that Chinese companies pose a security risk.

Even some in the UK, a member of the Five Eyes intelligence-sharing network with the US, are pushing back. Robert Hannigan, the former Director of Britain’s signals intelligence agency, GCHQ, called US assertions “nonsense.” On Friday, Alex Younger, the current head of the UK’s Secret Intelligence Service – also known as MI6 – suggested he doesn’t support a ban, telling reporters: “it’s more complicated than in or out.”

Decline of US leadership

In the end, some US policy experts lament, Washington’s fight against Huawei is really about the failure to form a coherent strategy to be competitive in high-tech industries.

“[The issue of Huawei] is or at least should be not about playing defense vis-a-vis competitiveness,” Robert Atkinson, who worked on China policy at the White House Office of Science and Technology Policy during the Obama administration, told Asia Times.

“Overall the idea that the US can keep its global market share in advanced technology industries without both strongly pushing back against Chinese ‘innovation mercantilism’ and putting in place a robust domestic innovation agenda is, I believe, misplaced.  We have to do both,” argued Atkinson, who is also the founder and president of the Information Technology and Innovation Foundation, which has been ranked as one of the world’s top technology policy think tanks.

Under the Trump administration, the situation deteriorated. A head of the White House Office of Science and Technology was not appointed until last month, leaving the body largely unstaffed since Trump took office in 2017.

“The fact that President Trump took so long to appoint the head of OSTP suggests that the President does not see this as a priority,” Atkinson said.

There are signs that the White House is trying to remedy this situation. Following the belated appointment of a top science advisor several weeks ago, Trump signed an executive order on maintaining leadership in artificial intelligence this week. But it does not provide any funding, critics note, and comes more than five years after China mapped out a strategy of broad support for high-tech industries. China’s policies call for national champions such as Huawei to develop key technologies such as 5G.

Floundering campaign against Huawei

On the defensive side, the US has failed to make convincing arguments to allies.

Two simple reasons are driving European resistance: 1) the US has yet to publicly offer specific examples of what security risks the Chinese firms pose, and 2) Huawei offers better equipment at a lower cost.

“It’s hard to know for sure whether or to what extent the fears around Huawei’s equipment are overblown or not,” Doug Brake, Director of Broadband and Spectrum Policy at the aforementioned ITIF, told Asia Times.

“Agencies within the US government like FBI and NSA that have claimed that there are security vulnerabilities or security concerns have not made any direct, specific examples,” he said.

John Costello, a former National Security Agency Officer who is now an officer at the Department of Homeland Security, stressed that the US is not yet prepared to offer such important details.

“Right now it’s difficult […] to really make a set of visceral examples that I think the public would understand,” Costello said at an event at the Center for Strategic and International Studies last week.

“Once we have a better understanding and can give better concrete examples that we think the public would digest I think you’ll see more from us on that,” he said, adding: “right now it’s just discussions with industry and really trying to understand the threat better.”

Paying a high price

“It will be a more expensive, perhaps not as high-performance network, keeping Huawei out of the market. That is not a costless decision,” Brake of ITIF said.

Major carriers in countries now resisting the US ban – including Vodafone in the UK and Deutsche Telekom in Germany – have warned that the financial costs and service disruption will be severe.

MI6 chief Younger, meanwhile, said the principal concern should be quality, and that does not need to come at the expense of security.

“We need to take a principles-based approach to this and the first is around quality,” Younger said in remarks to reporters Friday, as reported by Bloomberg. “This has got nothing to do with the country of origin; we should be insisting on the highest level of quality in any form of technology platform or service we choose to use and in particular security quality.”

US resorts to coercion

While the Washington intelligence community sorts out exactly what the risks are, top officials are now using threats to get allies to fall in line. The US ambassador to the EU warned in an interview last week that countries “may find themselves in a disadvantage in dealing with [the United States],” should they dismiss the security concerns.

Secretary of State Mike Pompeo issued a similar warning during a visit to Hungary on Monday.

“We have seen this around the world, it also makes it more difficult for America to be present; that is, if that equipment is co-located in places where we have important American systems, it makes it more difficult for us to partner alongside them,” Pompeo said.

While Vice-President Mike Pence praised Poland for helping to “protect the telecommunications sector from China,” when traveling to the country this week, there is no sign that Warsaw is ready to give up Huawei gear.

“We don’t see slowdown in sales on Huawei equipment here,” Huawei’s standards manager in Europe, Goerg Mayer, said in a news conference. But, he acknowledged, “if the situation continues, at some point it will impact our business as well.”