Australia today (June 13) formally agreed to help build a 4,000 kilometer (2,500 mile) underwater cable connecting it to the Solomon Islands, which has long been stuck with slow internet speeds.
The cable was originally set to be built by Huawei, the Shenzhen-based maker of phones and networking equipment. But Australia quickly pushed for a reversal. In July 2017, Fairfax Media reported that a member of the Australian intelligence service had warned the Solomon Islands government against working with Huawei, citing concerns about cybersecurity.
The deal between the two countries is another sign that countries around the world are growing increasingly suspicious of ties between the Chinese Communist Party and China’s tech companies. Canberra is also growing increasingly cautious of China’s rising influence in its backyard, as Beijing ramps up its economic influence in the tiny nations in the Pacific.
Australia has long been cautious about doing business with Huawei. In 2012, the country blocked Huawei from tendering contracts for its $38 billion national broadband network citing cybersecurity concerns. Lawmakers in Canberra are also mulling a ban on Huawei equipment (paywall) as domestic telcos build their 5G networks.
As in the US, the Australian government remains suspicious about Huawei’s potential ties to China’s government. The company was founded in the 1980s by Ren Zhengfei, a former member of the People’s Liberation Army. Politicians have also pointed to the company’s unusual shareholding structure as grounds for suspicion as to who owns it.
“Both Huawei and ZTE must report to the Communist party cell at the top of their organisations,” an opposition lawmaker told parliament earlier this year, referring to Huawei and its domestic rival. “Let me issue a clarion call to this parliament: Australia’s 5G network must not be sold to these telcos.”
Huawei has regularly denied having any direct links to China’s government. “There is no ownership by the government whatsoever—we would term our form of ownership a co-operative in western societies,” said John Lord, who heads Huawei’s Australia business.
Australian politicians did not specifically mention Huawei when announcing the Solomon Islands cable deal. But Rick Houenipwela, prime minister of the Pacific nation, said: “We have had some concerns raised with us by Australia, and I guess that was the trigger for us to change from Huawei to now the arrangements we are now working with Australia on,” he told Sky News.