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Saturday, February 22, 2020
Our View

China’s wrongs makes the right choice on tech an easy one

Add the coronavirus to the list of issues Canada has with China, which has practiced trade extortion, hostage-taking (former diplomat Michael Kovrig and entrepreneur Michael Spavor), corporate espionage on top of concerns about real estate prices and money laundering. Throw in the longstanding globalization issues and it’s clear Canada doesn’t always see eye to eye with the communist state.

Lobbying and corporate self-interest aside, it would seem logical that security concerns alone would be reason enough to exclude China from Canada’s roll out of a 5G network, as agencies here and allies abroad have indicated Chinese companies such as Huawei have strong ties to the authoritarian regime, with back doors and Trojan horses being built into network hardware.

The United States, Australia and New Zealand, all key Canadian allies, have already announced restrictions on the use of Huawei equipment. The UK has allowed it, but with controls. There’s a backlash brewing in Germany against a decision to include Huawei in that country’s 5G network.

Canada is already embroiled in an investigation of Huawei’s activities, including charges of circumventing sanctions on Iran and theft of intellectual property, having arrested the company’s chief financial officer, Meng Wanzhou, and holding her for extradition to the U.S. (That’s the proximate cause for the kidnapping of Kovrig and Spavor.)

Given China’s increasing authoritarianism and its more aggressive stance globally, it simply makes sense to prevent it from taking part in the rollout of new communications technology. Huawei stands accused of both stealing technology and being subsidized by the communist government to aid in the spread of its equipment as a means of spying on a large scale.

Western intelligence agencies have flagged China as a major counterintelligence threat. Worries about economic espionage abound, with such investigations by the FBI in the U.S., for instance, predominantly involving China.

Caught up in a dispute with China, Canada has plenty of reasons to re-evaluate the costs, most of them negative, of doing business with the authoritarian regime. That said, the time for the West to have avoided getting entangled with China would have been some 20 years ago, before the massive influx of cheap plastic crap and the technology boom that really enabled widespread spying and theft.

The spat touched off by the arrest Meng Wanzhou shines a light on what is a most unhealthy relationship.

Leaving aside the trade imbalances – a big part of the U.S. rift with China just now – there remains a long list of concerns, including using the diaspora (including students) as spies, persistent cyber attacks, intellectual property theft, espionage, lobbying, currency manipulation, attempts to buy up foreign assets and related fraud. Not to mention the moral issues of dealing with an authoritarian regime willing to inflict its ill intentions on everybody, including its own people.

Of course, all of that is tempered by the desire for profit, which is what drives the likes of Walmart to outsource jobs there – some 400,000 between 2001 and 2013 alone – and to invest billions of dollars. Governments and corporations see the prospect of a huge market and instantly lose the ability to discern right from wrong – an affliction that goes well beyond China, of course.

Some companies are realizing that doing business in China has meant intellectual property theft, mandatory transfer of proprietary technology (subsequently stolen) and foreign ownership restrictions that are seldom matched back on home soil.

Getting off the made-in-China ride now will be more difficult than we hadn’t opened Pandora’s Box in the first place. That doesn’t mean we shouldn’t try.

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