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Australia’s biggest ‘China threat’ is not Huawei, but itself

In a move that has drawn criticism from Chinese authorities, the Abbott government is upholding a ban on Chinese telecommunications giant Huawei from tendering for the National Broadband Network, after…

Chinese telecommunications giant Huawei is in the spotlight again. jontintinjordan/Flickr

In a move that has drawn criticism from Chinese authorities, the Abbott government is upholding a ban on Chinese telecommunications giant Huawei from tendering for the National Broadband Network, after receiving advice from national security agencies.

It’s best to leave the technological question of spying to the finest intelligence agents. What we should really learn from the Huawei ban is that the biggest threat to Australia’s future development is not Chinese firms such as Huawei, but Australia’s own poverty in high-tech capability, and in understanding China. Here are four key arguments for this:

First, the profound distrust of China’s current political regime needs to be reviewed.

Only last week the US was accused of spying on German Chancellor Angela Merkel. But espionage fears over this breaking news, as compared to those over China, can ease relatively quickly. It seems as if we still live with a Cold War mentality. We see little to rectify the institutional failures of the global financial crisis, while we are quite sceptical about the potential of China’s next stage of reform that is culturally backboned and aims to gain genuine trust.

This psychological effect can be best exemplified by a recent comment on Huawei made by Joshua Frydenberg, a parliamentary secretary to the Prime Minister and adviser on intelligence matters to the Howard government. Mr Frydenberg said that Australia should “do nothing that endangers the high level of intelligence cooperation that we currently enjoy with the US”.

Gwydion M. Williams/Flickr

But is there an alternative? Can the US, Australia and China work together for a better world for all?

Second, Australia’s poor understanding of China and its culture has pushed too much focus into political and ideological distrust. This has hindered the Australia-China economic relationship.

In repeated calls for a holistic perspective of China, I have cautioned that for over a century, the world has accumulated an excessive amount of plausible “China information” that needs to be replaced by the rarely available “China knowledge”. For instance, is guanxi (relationship) a Chinese value? Did China have no understanding of rule of law in its own tradition? Where is China’s current reform headed? The Cold War mentality has entirely different answers to these questions, but none of them are rooted in a holistic perspective of China. In many cases, misconceptions such as “fortune cookies" and “dragon emperors” are all we know.

Chinese business people are upset that wherever they go in developed countries, there is a suspicion of their communist “origin” or political “genes”. One way of changing this is to use improved understanding of Chinese business culture to help Chinese companies to comply with Australian conditions.

Third, the Huawei ban may affect current negotiations regarding the Free Trade Agreement between China and Australia, but there are many other difficulties facing both parties.

China wants to sell its technologies and alluring investment to Australia but there is an Australian national interest agenda that this sometimes conflicts with. Australia wants to export its financial services and food to China but these can be regarded as potential challenges to China’s financial and food securities, given the lessons learnt from the global financial crisis as well as China’s underlying policy that protects hundreds of millions of Chinese farmers.

The ultimate barrier is mutual trust. Hua Chunying, a spokeswoman for the Chinese Foreign Ministry, commented on the Huawei ban that: “We really hope that both sides could make an effort to create a level playing field for enterprises to carry out normal cooperation… on a basis of mutual respect, equality and mutual benefit.”

Such trust can only happen when Australia’s understanding of China is seriously improved.

Fourth, Australia needs to move away from a mining-centric focus and foresee both opportunities and challenges in China’s resurgent innovation economy, of which Huawei is an example.

Two weeks ago, when meeting with Governor Quentin Bryce in Beijing, China’s new Premier Li Keqiang attempted to sell China’s advanced high-speed rail technology to Australia. China already has a multi-layered, powerful national innovation system, while Australia doesn’t.

The Asian Century White Paper, recently dumped by the Abbott government, claimed that “by 2025, Australia will have an innovation system, in the top 10 globally”.

Our world economy is dominated by technology leaders, such as the US and Japan, and in the future, China. Australia is not among the leaders and a technologically competitive Australia is a must. It will offset the effects of the unsustainable, labour-based resource industry and benefit Australia on a higher level in the global value chain.

Facing China’s new rise, Australia should recognise two very urgent tasks: first, understanding China and its culture is the fundamental platform for Australia to establish mutual trust with China; and second, China is returning as a global innovation leader and Australia needs to dramatically improve its innovation competitiveness before it can gain strategic benefits from China’s future economy, which is to be knowledge-based.

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33 Comments sorted by

  1. wilma western

    logged in via email @bigpond.com

    This is a well argued article and while many Australian companies are noiw involved in China there needs to be a more widespread and better understanding by the general Australian public .

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    1. David Elson

      logged in via Facebook

      In reply to wilma western

      A greater emphasis needs to be placed on this by our various education systems.

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    2. Frank Moore

      Consultant

      In reply to wilma western

      And Wilma, you can see nothing obnoxious about taking a "this is their culture - so we must accept their dictatorship and their hourly human rights abuses and crimes against humanity" line as described above?
      And Wilma - lets be clear - you want this shocking line of appeasement force fed down the throats of our school children?

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    3. David Elson

      logged in via Facebook

      In reply to Frank Moore

      Australia does business with much worse nations (middle east?) everyday of the week. Why make an exception for China? Especially now as they are now our most valuable trading partner!

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    4. Frank Moore

      Consultant

      In reply to David Elson

      The point of the writer above - and Wilma - is they - you? - support an integration with this most heinous of regimes.
      The immigration and visa for money and visa for education policies in particular create a scenario where the heart of our democracy is attacked by these supporters of an organ harvesting dictatorship actually lobby and vote in Australian elections - with the best interests of the PRC at heart!
      We are currently entertaining card carrying members of the PRC communist party in our…

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    5. David Elson

      logged in via Facebook

      In reply to Frank Moore

      Now you see, all you've done is reiterated your position without answering the million dollar question above,

      Perhaps your problem is not that the Chinese Government are totalitarian communists, running a largely free market economy, but that they are not communist enough?

      Let me try again; Why single out China for your abuse when many of our other (albeit smaller) trade partners are also guilty of state sanctioned human rights abuses?

      Should we also cut all trade with the Middle East? With Indonesia? With Malaysia?

      Where do you draw the line?

      Their government aside, the cultural tendencies of the Chinese people themselves, whether they are from the mainland, Taiwan, HK or Singapore is imminently compatible with Australia.

      So yes, their students, their immigrants and their FDI is essential for our future prosperity; Especially given the faltering nature of the European and US economies.

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    6. Frank Moore

      Consultant

      In reply to David Elson

      David Elson, I have not abused China - just accurately described them!
      To get to the heart of your question, Malaysia, Singapore, Middle Eastern nations are not the greatest existential threat to both Australia and the free world that the PRC is.
      The PRC dictatorship is awesomely competent. Therein lies the danger.
      They obviously have the tertiary sector in Australia wrapped up...

      As to your line about all people of a certain race being "imminently compatible" with Australia? Wow. That's a…

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    7. David Elson

      logged in via Facebook

      In reply to Frank Moore

      "David Elson, I have not abused China - just accurately described them!"

      Aside from referring to Australian-Chinese as traitors and the Chinese in general as organ harvesters?

      I'll get onto your points next:

      "To get to the heart of your question, Malaysia, Singapore, Middle Eastern nations are not the greatest existential threat to both Australia and the free world that the PRC is. "

      Who says? Is there any credible evidence that China plans to [cue spooky music] take over the world…

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    8. Frank Moore

      Consultant

      In reply to David Elson

      David Elson, you are sounding desperate - or emotionally involved?
      You said: "Aside from referring to Australian-Chinese as traitors and the Chinese in general as organ harvesters?"
      I didn't.
      I note that you disparage but don't dispute the fact that your beloved PRC harvests the organs of its political prisoners. Do you dispute this?
      You claimed, that Chinese "the cultural tendencies of the Chinese people themselves, whether they are from the mainland, Taiwan, HK or Singapore is imminently compatible…

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    9. David Elson

      logged in via Facebook

      In reply to Frank Moore

      If America and Japan were threatening you and arming and paying your neighbours to oppose Australia what would you advocate we do?

      As for the organ harvesting; I do not condone these types of crimes against humanity, infact I have heard of far worse things occuring in China (both state sanctioned and otherwise).

      This however is not a good reason to ban FDI from China, nor end the stream of well educated high quality immigrants we receive from China.

      If our govs can make our nation more competitve (ending our super high energy costs for example), who knows? Maybe infuture a Chinese manufacturer would invest in Australia in much the same way Mr Toyoda has, or Nippon meat packing did?

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  2. R. Ambrose Raven

    none

    Our general adoption of American spelling and mannerisms itself demonstrates our complete psychological commitment to the United States.

    Debate about Chinese ownership of Australian land is of course the wrong subject, discussed with regard to wrong parameters. What we do with what we have – the unavailability of finance for new local ventures, for instance – is far more important. Indeed debates over ownership may be a deliberate diversion from increasingly necessary interventionist industrial…

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  3. Gil Hardwick

    anthropologist, historian, novelist, editor and publisher at eBooks West

    "What we should really learn from the Huawei ban is that the biggest threat to Australia’s future development is not Chinese firms such as Huawei, but Australia’s own poverty in high-tech capability, and in understanding China."

    Ken, my friend, you make my heart sing.

    I matters far less to me how the message gets through finally, only that it get's through.

    Australia, get out of your own way finally. China like the rest of Asia are our friends and neighbours, with far more in common than…

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    1. Gil Hardwick

      anthropologist, historian, novelist, editor and publisher at eBooks West

      In reply to Gil Hardwick

      Merely to add your welcome observation on 'guanxi'.

      For long I thought I was the only one to post such a simple argument here, though sadly it yet seems one of too few Australians to understand what a good relationship with others is about, which it must be added does not come freely.

      Like trust, it must be sought after and earned.

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  4. Craig Myatt

    Industrial Designer / R&D

    Sound article...however, I am no fan of China's spying on their own citizens, nor spying on foreigners, as this cuts to the heart of the distrust of China: it seeks control over all things, in 'relationships'.

    One aspect of mistrust (for me as an Australian), is that the perception of possible spying on Australia, through for example Huawei, with its strong links to the Chinese State, (through its founder) arises from 'information asymmetry' where China appears to gain commercial advantage by…

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    1. Gil Hardwick

      anthropologist, historian, novelist, editor and publisher at eBooks West

      In reply to Craig Myatt

      No, it's not reasonable, Craig. It's paranoia, explicit in your choice of terms, "strong aversion to the (forceful) and highly offensive social control". What social control? Whose aversion? Highly offensive to whom?

      What we are observing here is the now thoroughly understood Western culture of fear and its attendant politics of fear; of what is known as bureaucratic late-modern risk-averse society. That is the lens through which you choose to view the situation.

      What you still don't seem to…

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    2. Craig Myatt

      Industrial Designer / R&D

      In reply to Gil Hardwick

      I don't share your view. On the other hand, I do wish to trust China, and I will take what you say to some degree on 'trust', that China is not one single entity, and allow that relationships with various people would better define my views of China. I have very few connections with China, although I have some acquaintances.

      My perspective is as a believer in liberal democracy, not in socialism, or communism, which is the prevailing governmental system, I believe in China. I was expressing…

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    3. Gil Hardwick

      anthropologist, historian, novelist, editor and publisher at eBooks West

      In reply to Craig Myatt

      Plainly you don't share my view, Craig. Political ideology and well-informed practical reality are two different planets.

      So I won't bother engaging you further. The exercise beyond what benefit might be gained by others in reading such disparate perspectives, becomes pointless.

      I will correct you on one small matter, however. Sun-tzu's classic 'The Art of War' is rendered here in the English translation. The more reliable translation, both in terms of Chinese thinking on the matter, and in…

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    4. John Canning

      Professor at University of Sydney

      In reply to Gil Hardwick

      In defense of Australia, actually Snowden has revealed we cannot trust Google, Twitter and so on, let alone national governments - these companies are not state owned enterprises so even a free society is not so free. It doesn't take a genius to see that the US example shows why you have to be pretty naive to counter the notion that any foreign company (Sweden, US, Japan, Africa or China) would not be undertaking spying capability and that this is not a serious issue for a government to consider…

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    5. Yanshuang Zhang

      PhD Candidate at University of Queensland

      In reply to Craig Myatt

      HuaWei is so pathetic that here in Australia people view it as the spying tool of Chinese government while back in China it is bashed by the state-owned tele enterprises and tries to survive in the cracks.

      Political ideology can indeed be split from the practical reality. To most Chinese private companies, to keep a good guanxi with the government is only important as to get access to the opportunities and favorable policies that are granted generously to the state-owned-enterprises. Except this, its relationship between SOEs and the government is very tense and strained.

      I feel so sad HuaWei will not contribute to the NBN construction, also for Australia's inability to utilize such an excellent company of true wit.

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    6. John Canning

      Professor at University of Sydney

      In reply to Yanshuang Zhang

      Huawei is not pathetic - it is a brilliantly successful company that probably could not have worked elsewhere under a different system and I understand is in fact the world's largest manufacturer of communications hardware as a result.
      Not operating in the small Australian NBN is not going to affect Huawei (and should not affect Australia - China ties despite the silly media statements) at all. National security issues are hardly a new thing - China itself is building its own NBN to further remove itself from the rest of the world for similar reasons: we can be confident that Huawei technology will feed this much larger NBN. Likewise Australia should really be building its own networks - it certainly has the know-how and capability to do so and it needs the industry.

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    7. David Elson

      logged in via Facebook

      In reply to John Canning

      If huawei is safe to build networks in the UK and elsewhere in the EU, why is it not safe to build the nbn here in Australia?

      Where is the credible evidence?

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  5. Frank Moore

    Consultant

    Sorry pal, but I don't trust communist, totalitarian states or anyone who does PR for them.
    Money doesn't talk - it swears - and PRC funds developed out of the very clever manipulation of the west by this, the world's most dangerous dictatorship, have "purchased" current and ex ministers of the crown, Local MPs, academic institutions (usually the first quislings in any nation's betrayal) and even ex Australian service personnel have been co-opted to work on behalf of this political prisoner executing, organ harvesting regime.
    I understand China completely.
    I understand traitors when I see them.

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    1. Mark Chambers

      logged in via Facebook

      In reply to Frank Moore

      Frank, well said.

      We can't trust the U.S.A. or Google or Yahoo not to spy on us but Ken Shao wants us to trust Huawei. I don't think so.

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    2. Frank Moore

      Consultant

      In reply to Mark Chambers

      Thanks Mark,
      its amazing really, the attitude of so many of our universities, academia generally and pollies from all taxpayer funded sides of politics.
      So many go beyond Neville Chamberlain's embrace of peace with Hitler policies and plunge into an outright love of such an amoral dictatorship.
      From recall, one university was recently caught bestowing honours on a surgeon involved with keeping political prisoners "alive" whilst they cut out their organs for transplant for profit.
      How that same university is allowed one dollar of taxpayer's money from that point on is beyond me.

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    3. David Elson

      logged in via Facebook

      In reply to Mark Chambers

      The UK trusted them (with some supervision) to build their network why can't we?

      Oh right, America told us not to... the same America that also spies on us.

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    4. David Elson

      logged in via Facebook

      In reply to Frank Moore

      Why hate their businesses and their people (as opposed to their gov)?

      China's economy is growing and if we want to keep ours growing then we will need more, not less, FDI from China.

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    5. Frank Moore

      Consultant

      In reply to David Elson

      David Elson, two governments from two sides of politics have copped a briefing from ASIO (and other agencies) and walked out with a policy position of not allowing NBN to be built out of PRC controlled interests.
      And, as there is no separation of powers in the dictatorship of the PRC, then it is simply ludicrous to differentiate between so called SOE's and so called "private" PRC based companies.
      (Even companies NOT run by ex PLA Generals)

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    6. Frank Moore

      Consultant

      In reply to David Elson

      David Elson you said:
      "Why hate their businesses and their people (as opposed to their gov)?"
      I don't.
      I love Australia.
      I'm an Australian nationalist.
      (Rare - but there!)
      And we don't need FDI from PRC or anywhere else.
      All we need to do is stop overpopulating the country via immigration, and concentrate our talents and investments on improving infrastructure (after getting a good return on investment from it) rather than continuously straining and bursting capacities all over the place).
      Your favoured PONZI scheme - immigration driven - economics is out of favour in a number of places.

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    7. David Elson

      logged in via Facebook

      In reply to Frank Moore

      I am glad to see you are an economic nationalist, there are too few.

      However as an economic nationalist you must realise that it is not in Australia's best interest for their to be;
      * 1 single preferred airline protected by the state; aka QANTAS.
      * 4 for dominating large banks with limited capital for business investment with their fingers in every ALP or LNP government.
      *2 heavily protected automakers, foreign owned producing good but overpriced vehicles.
      * 2 giant grocery chains squeezing…

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    8. David Elson

      logged in via Facebook

      In reply to Frank Moore

      I would to see the evidence, not some 'fears' manufactured by America to drive a wedge between us and their current rival.

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    9. Frank Moore

      Consultant

      In reply to David Elson

      David,
      you are sucked in:
      You are focused on perceived benefits to consumers resident in Australia.
      Australia is dying of consumption justified policies.
      Such thinking brought in mass immigration.
      (Why export orientate your business when you can pay and lobby your nation's leaders to bring a market to you? A major reason for bankrolling Murdoch, the Churches and sleaze concentrated businesses such as property development, retail and academia has been their activism for so called "growth" via…

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    10. David Elson

      logged in via Facebook

      In reply to Frank Moore

      It's not just about consumption.

      It's simple numbers. More people, more scientists more engineers more innovators more discoveries and new tech.

      More capital equals more research and dev, more projects and more results.

      The current status quo with hamstrung capital and relatively tiny numbers of skills innovators is hardly ideal. Thie big companies (even aussie ones) simply do most of their R&D elsewhere.

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    11. David Elson

      logged in via Facebook

      In reply to David Elson

      We will never export more value added goods than we import until we fix the fundamentals above.

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