Why Huawei?

Published in Insights, The New Zealand Initiative’s newsletter, 24 May 2019

Earlier this year, I got myself a new smartphone. Its 7-nanometre processor is lightning fast, the triple camera takes stunning pictures, and the huge battery is still half full at the end of a working day. It is by far the best phone I have ever had.

No wonder Donald Trump is worried about the technological and commercial threat Huawei’s poses to US companies.

Okay, that is not how the US President justified his blacklisting of the Chinese technology firm this week. But that is the most plausible explanation of the presidential order.

For many years, the US government has been trying to stop Huawei’s meteoric rise, even putting pressure on other Western governments not to buy equipment for their 5G mobile phone networks from Huawei.

Most of these countries have been unconvinced and continue doing business with the Chinese. But Washington has consistently and stridently accused the privately owned Huawei as being a threat to national security by allowing the Chinese government to conduct global espionage.

The problem is the US has never presented evidence for this claim, nor has it ever been publicly proven.

That is not to rule out any such activity on Huawei’s part. However, we have no way of knowing. We can only either trust or distrust the US government and its intelligence agencies.

So should we trust the US government – or, more specifically, this US government?

As Daniel J. Ikenson, trade expert at Washington’s Cato Institute, put it: “President Trump has made a frivolity of the national security rationale for restricting trade.”

Ikenson rightly points out that Trump has previously justified import restrictions on steel, aluminium and cars on national security grounds. None of these cases, and with all relevant information publicly available, have indicated any genuine threats to security.

One might add that Trump has also abused the national security argument in his attempts to force Congress into providing funding for his great Mexican wall.

With such self-serving manoeuvering being the trademark of the Trump administration, why should the world believe its exhortations on Huawei?

A far more plausible explanation for Trump’s Huawei ban lies not in national security but in America’s escalating trade conflict with China. Telecoms and networking technology are crucial industries, and that makes commercially successful companies like Huawei top targets.

The real victim, however, is not Huawei. It is the global trade order under the WTO, technological progress, and consumers everywhere.

I will enjoy my Huawei Android phone while I still can.

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