How the Huawei decision saw the old friends prevail

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The Government’s decision to ban Huawei from participation in the Spark 5G network was the only one it could have come to.

To have let Huawei in would have placed New Zealand at odds with its traditional friends  --- Australia, the United States and Britain – and offside with the Five Eyes alliance.

Nevertheless, New Zealand now faces risks that its relationship with China may be impacted.

Late yesterday China's Ministry of Foreign Affairs spokesman, Geng Shuang, expressed "serious concern", and said China-New Zealand business ties were mutually beneficial and win-win.

"We hope the New Zealand government provides a fair competition environment for Chinese companies operating in New Zealand, and does more to benefit bilateral mutual trust and cooperation," he told a daily news briefing.

The announcement in Wellington yesterday afternoon came coincidentally with the presence in the capital of a top-level delegation from the British Foreign office and also a senior FBI official from the US.

The FBI official was here to open a new FBI liaison office in Police Headquarters.

The Huawei decision and the visits together demonstrated how conventional the Ardern Government’s foreign policy is becoming.

The decision was announced in a brief statement from Spark which said: “Spark New Zealand recently notified the Director-General of the Government Communications Security Bureau (GCSB), in accordance with the requirements of the Telecommunications (Interception Capability and Security) Act 2013 (TICSA), of its proposed approach to implementing 5G technology on the Spark mobile network.

“Specifically, this proposal involved the deployment of Huawei 5G equipment in Spark’s planned 5G Radio Access Network (RAN), which involves the technology associated with cell tower infrastructure.

“The Director-General has informed Spark today that he considers Spark’s proposal to use Huawei 5G equipment in Spark’s planned 5G RAN would, if implemented, raise significant national security risks.”

Andrew Hampton, the Director-general of the GCSB, confirmed that in a separate statement.

It appears that a British Government report from July may have played a key role in the GCSB’s decision.

The report, from the Huawei Cyber Security Evaluation Centre (HCSEC) Oversight Board, evaluated similar Huawei equipment to that being considered by Spark. It included input from British security agencies.

It concluded that shortcomings in Huawei’s engineering processes had exposed new risks in the UK telecommunication networks and long-term challenges in mitigation and management.

“Due to areas of concern exposed through the proper functioning of the mitigation strategy and associated oversight mechanisms, the Oversight Board can provide only limited assurance that all risks to UK national security from Huawei’s involvement in the UK’s critical networks have been sufficiently mitigated,” it said.

There are also significant fears that Huawei and other Chinese telcos could be compelled by Chinese security services to help with intelligence gathering under new laws passed last year.

The national intelligence law requires all organisations and citizens to assist the country’s spy network.

In August Australia barred Huawei from participating in its 5G network.

The decision will be seen by Britain as further evidence of what appears to be a major warming of relations with New Zealand.

These have hit bumps this year with British concerns that New Zealand, in particular, Foreign Minister Winston Peters, did not take their concerns over the Russian poisoning case in Salisbury and its ongoing actions in Ukraine seriously enough.

That, presumably, is why they included a senior Foreign Office specialist on Russia in the delegation in Wellington for the annual UK-NZ Strategic Alliance talks between officials from both countries.

But otherwise, things appear to be going well.

In two weeks Climate Change Minister, James Shaw will co-chair with a British Minister climate change talks in London involving a number of Pacific countries.

And POLITIK understands that New Zealand has agreed to share its High Commissions’ office space in Apia and Nukualofa with new British diplomatic teams being posted to the Pacific.

The British will also re-establish a post in Port Vila.

New Zealand has been pressing Britain to play a more active role in the Pacific --- part of the Pacific reset which has been promoted by China’s growing presence in the region.

But the British made it clear in Wellington they would prefer to work alongside China (and Australia and New Zealand) on aid projects in the region rather than adopting the American approach of shutting China out altogether.

For the meantime though, New Zealand may have to brace itself for some response from Beijing over the Huawei decision.

China reacted to the Australian decision with its Commerce Ministry posting a statement on its website: "The Australian government has made the wrong decision, and it will have a negative impact to the business interests of China and Australia companies.”

Though there have been suggestions of pressure on the Government, POLITIK understands that was not the way the other Five Eyes partners played it.

They appear to have relied on the British report and other technical information to convince not only the GCSB but also the Prime Minister herself.

One New Zealander intimately involved in the NZ_China trade relationship said inevitably he feared at some level there would be repercussions.

But the Government will have balanced that against its relationships with the three traditional friends; it would have been no contest.

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