Who’s afraid of Huawei Technologies Co.?

Why are Western government officials so afraid of Huawei Technologies Co.?

The Chinese tech giant is facing increasing scrutiny in the West, where lawmakers in several countries have recently expressed concerns that the Chinese government could use Huawei’s telecom equipment to spy on networks or access critical infrastructure.

In March, the debate over Huawei flared again in Canada after three former national security agency leaders urged the government to follow in footsteps of the U.S. and limit ties with the company.

Earlier this year, political pressure in the U.S. reportedly killed a deal between AT&T and Huawei and last month Best Buy decided to stop selling Huawei’s smartphones, which compete against Samsung and Apple when it comes to global market share.

Ajit Pai, chairman of the U.S. Federal Communications Commission, detailed some of the Americans’ fears while issuing a proposal to ban the public purchase of telecom equipment from companies that pose national security threats.

“Hidden ‘back doors’ to our networks in routers, switches — and virtually any other type of telecommunications equipment — can provide an avenue for hostile governments to inject viruses, launch denial-of-service attacks, steal data and more,” Pai said in a statement last week. He didn’t single out Huawei, but cited it and other Chinese tech companies in a previous letter to lawmakers.

Huawei insists it’s not tied to the Chinese government, and there is no public evidence that the company has been involved in espionage.

But some aren’t convinced, given past ties between Huawei’s leadership and the Chinese Communist Party and military.

Canada’s Public Safety Minister Ralph Goodale assured Parliament that Huawei is safe, but the debate has raised questions over what exactly Huawei does in Canada and whether those activities could pose a risk.

Huawei wouldn’t put a dollar value on its business in Canada, which includes testing next-generation 5G wireless networks and supplying the equipment needed to operate them, as well as selling smartphones.

The company entered the Canadian market in 2008 and has about 725 employees, roughly 425 of which work in research and development, spokesman Scott Bradley said in an interview.

It works with 10 universities and all the major wireless network operators, including partnerships with Telus Corp. and BCE Inc. to develop 5G networks. When it comes to network infrastructure, Bradley said Huawei equipment is used mostly for the radio access on the edges of the network. Essentially, this means it does not have access to the core network, which is the technological backbone that allows communications to travel.

Bradley said Huawei has worked “openly and transparently” with the Canadian government from the outset to protect the integrity of Canada’s telecom infrastructure.

“We have been operating in Canada for 10 years without issue, and believe strongly this achievement reflects the collective efforts we have made, and continue to make in working openly and transparently with Canadian operators and the Canadian government,” he said.

“Protecting the national interests of our operators and Canadian stakeholders is paramount to everything we do in Canada.”

Spokespeople from Bell, Telus and Rogers Communications Inc. defended their network security and their choice of suppliers. None elaborated on exactly how much business they do with Huawei.

“Bell works with numerous Canadian and international partners, including Nokia, Huawei and Cisco as primary suppliers of wireless infrastructure equipment. All Bell suppliers are required to meet our strict security standards and abide by our supplier code of conduct,” Bell spokesman Marc Choma said in a statement.

“We design and manage our networks leveraging a host of leading international technology providers. We work co-operatively with all Canadian government agencies to ensure that all our technologies, wherever they may originate, meet necessary security and quality standards,” Telus spokeswoman Erin Dermer said in a statement.

“The security of our networks is vitally important to us, and we have a rigorous process in place when we assess any potential supplier as part of the ongoing work we do to ensure our networks are safe and secure,” Rogers spokeswoman Michelle Kelly said in a statement.

Canada isn’t the only Western country to use Huawei’s technology. It is also a big part of the United Kingdom’s telecommunications system. In the U.K., however, the government set up the “cell,” a facility where cybersecurity experts check Huawei software and hardware for flaws that could be exploited for spying. Every year, an oversight board evaluates the work done at the facility to ensure the U.K.’s national security is protected given the use of Huawei equipment in its critical infrastructure.

It’s not clear what sort of hoops, if any, Huawei has had to jump through to operate in Canada.

But for Satyamoorthy Kabilan, director for national security and strategic foresight at the Conference Board of Canada, the question is bigger than Huawei. He said companies and governments must do their due diligence regardless of who they choose as a third party supplier.

“You’re taking a risk whenever you use a third-party supplier,” Kabilan said in an interview, whether that’s buying wireless network equipment or a laptop.

“Where we really need to get that risk balance right, is what happens if that’s the laptop that runs a nuclear reactor?”

No ecosystem is immune from threats, so Kabilan said it’s important to determine which parts can handle risk. A recent Conference Board survey of IT professionals found organizations are more aware of insider cybersecurity threats but aren’t preparing for the risks as much as they should, he said.

Still, Goodale told Parliament in March that cybersecurity is an “extraordinarily important priority” for the country.

In the 2018 budget, the feds set aside more than $700 million to tackle cybersecurity in general, and announced plans to create a Canadian Centre for Cyber Security and a National Cybercrime Coordination Unit. Goodale said this centre will “pay particular attention” to Canada’s critical infrastructure, adding the government just completed a national security review of its cybersecurity systems.

“That has included every dimension of those systems, including how best to protect critical infrastructure. We will take every step necessary to make sure that this critical infrastructure, which is vital to Canada and to our relations with countries around the world, is properly protected and defended.”