If we allow overconfidence about our ability to mitigate all risks from Huawei’s potential inclusion in 5G, Canada could be making a grave and irreversible mistake. Canadians deserve to reap the benefits of 5G and will do so, but not at the cost of its national security and that of our allies, writes Jonathan Berkshire Miller. 

By Jonathan Berkshire Miller, June 29, 2020

Earlier this month, two of Canada’s largest telecommunications companies, Bell and Telus, released statements within hours of each other indicating their plans to move forward on Canada’s next-generation 5G network. The two telecommunications giants announced in their news releases that they would work with European carriers Nokia and Ericsson as vendor partners in the initiative.

The releases have left some to wonder what all of this means for the Chinese carrier Huawei, which is also lobbying hard to be included in Canada’s 5G networks. While some have applauded the move as a clear indication that Huawei is likely to be locked out from participating in our next-generation networks, there was no reference to such an outcome or indication that Huawei has fallen out of favour with two of Canada’s main carriers.

Indeed, the potential role of Huawei in 5G was conspicuously absent from Bell and Telus’ announcements. To be sure, Huawei is not officially “out”, as the federal government has yet to make a final decision based on its 5G security review decision. The announcements were carefully worded so as not to dismiss the idea of Huawei in the future — the announcements merely indicate plans to use Ericsson and Nokia as key partners. Moreover, shortly after the release, Bell representatives stressed the fact that Huawei remains a potential option as a partner for its 5G network, but it is dependent on the government’s security review decision.

Thus, if the government security review decision is pending, what, if anything, has actually changed? There are two plausible answers.

First, it is possible that the telecommunications industry has slowly accepted the fact that government was not going to make an imminent decision on the matter, especially in light of the pandemic and already strained ties with China. By releasing a forward looking — but non-committal — statement, Bell and Telus are effectively able to get in front of the news rather than appear to be reluctant losers (should the government proceed to restrict Huawei).

Alternatively, the decision to go public on their plans may have been related to indications they have received from government officials on the likelihood of such a ban.

It was only earlier this year that Telus appeared confident in its position that it would roll out 5G and that the launch would include components from Huawei. Telus currently uses Huawei components in its 4G systems and estimates that it would cost the company at least $1 billion to rip out such components in order to comply with a full-scale ban on Huawei in 5G.

This state of limbo is unacceptable for a number of reasons. First, while restrictions on Huawei in our 5G systems should be seen as a strategic imperative, this decision and its communication should not fall on the laps of the private sector alone. Despite its competing pressures and diplomatic sensitivities, the government of Canada needs to decide on 5G sooner rather than later. The entire process has been drawn out for too long and has left our key allies concerned and confused. It has also weakened the important stakeholder relationships between the telecommunications industry and the public sector.

The strategic stakes and consequences remain unchanged. Despite some arguments that stress Huawei as a viable alternative to Nokia and Ericsson due to the cost advantages or research and development edge, the downside risks remain far too high.

Huawei claims that it is a private company and being unfairly treated by the Trump administration in the U.S. But the reality remains that Huawei is a company beholden to higher laws in China that could — and most likely would — make it a tool for state-sponsored espionage. Case in point is Beijing’s 2017 national intelligence law, which compels all private companies to “support, cooperate and assist” with the state on issues of national security and intelligence. Such activities could include the implantation of backdoors into Huawei 5G networks that might allow Chinese intelligence officers to collect information on foreign stakeholders.

Canada’s security review on 5G must recognize this point and also understand the geostrategic context as China continues to challenge the international rules-based order on a range of fronts, beyond the issue of 5G. The United States has labelled China a “strategic competitor” and taken a much harder and more realistic view on its ability to induce Beijing to be more accepting of international laws and norms, whether it be on 5G, in the international trade domain or on maritime security.

Canada’s other allies in the Five Eyes — an intelligence sharing network between the U.S., Canada, the U.K., Australia and New Zealand — may have different articulations but share similar assessments on China’s increasingly aggressive and destabilizing efforts. This is particularly the case in the intelligence world, where Beijing is conducting an expansive and multi-pronged effort at illicitly gathering sensitive information — both in the public and business domains — from the U.S. and its allies. And these concerns are still valid despite the recent decision from the United Kingdom to partially allow Huawei into its 5G networks. Other key international partners, such as Japan, have also decided to exclude Huawei from their 5G plans for national security reasons.

As has been the case since the beginning, Canada cannot afford to risk our security and sovereignty. If we allow overconfidence about our ability to mitigate all risks from Huawei’s potential inclusion in 5G, Canada could be making a grave and irreversible mistake. Canadians deserve to reap the benefits of 5G and will do so, but not at the cost of its national security and that of our allies.

Rather than abdicating this decision to the private sector, it is time for Canada to make a decision that best serves its interests.

J. Berkshire Miller is deputy director and senior fellow at the Macdonald-Laurier Institute and senior fellow with Japan Institute of International Affairs.

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