Canada continues to assess the degree of participation that Huawei will have in the 5G network project. Last week, Justin Trudeau, Canadian Prime Minister, declared that the decision will be based on “technological and national security elements, and not political factors.” The United States and Australia completely closed the door to Huawei, while the United Kingdom has opted to allow a limited role for the Chinese company.
Canadians will have to make a decision within the framework of a trade war between Washington and Beijing, where suspicions of Chinese espionage also appear through one of its largest companies in the world. Huawei has denied that its networks and devices can serve this purpose. Last week, the US government included Huawei on a blacklist that makes it impossible for US firms to do business with the Chinese company, citing risks to national security. Markets rocked substantially when Google announced its break with Huawei. However, President Donald Trump declared a three-month truce before the provision came into effect.
Canadian relations with Huawei and the Chinese regime are especially delicate due to the Meng Wanzhou case. The vice president of the tech giant was arrested on December 1 at the Vancouver airport, at the request of the Americans. Meng, accused of fraud to allegedly violate US sanctions on Iran, is free on bail pending a determination as to whether she will be extradited, but must adhere to strict surveillance measures. Both Huawei and Beijing consider that the arrest was politically motivated.
The pressure on Trudeau about Huawei’s participation in the 5G network has reached Parliament. Conservatives call the prime minister undecided and demand that the veto of the company comes soon. On the other side of the border, opinions in the same direction have been heard for months, on the part of the Trump administration. However, Trudeau and several of his ministers have stressed that it is necessary to evaluate different aspects to benefit and protect Canadians.
Security experts have addressed the issue in national media. Wesley Wark, a professor at the University of Ottawa, wrote on the pages of The Globe and Mail that the Canadian government must find an intermediate solution, where the protection of sensitive information, the benefits for the consumer and the fruits of innovation coexist through alliances. However, others suggest outright banning. Michel Juneau-Katsuya, a former agent of the Canadian Intelligence and Security Service, told the newspaper La Presse that it would be a huge mistake to accept that the firm participate at any level. “It is a mirage when they tell us that Huawei has no ties to the Chinese government. You cannot operate such a strategic company in China without these ties. China does not even authorize free access to the Internet, ”he commented.
Huawei has stressed that it has never had problems with Canadian laws in the 10 years it has been working in the country. He has also specified that he shared with the authorities all the information necessary to be evaluated in terms of security regarding the 5G network. The company employs about 1,000 people in Canada, has invested nearly $ 500 million (about 330 million euros) in research and development, and has links with 10 Canadian universities. In turn, it has contracted the services of communication and public relations firms to improve its image in Canada, affected by the attacks from Washington and the arrest of Meng Wanzhou, in which Beijing has shown toughness towards Ottawa.
Impact on the economy
The Canadian economy suffers the impact of the crisis with the Chinese. In March, China stopped buying canola seed from the North American country. In 2018, Canada exported just over 5 billion Canadian dollars (about 3.3 billion euros) of this merchandise; about 50% to China. The Chinese authorities justified the decision by citing “risks due to the presence of parasites”. Also, in early May, Beijing canceled the permits of two large pork companies, both from Quebec, on the grounds of “packaging and labeling problems.” The Chinese market is the second most important for Canadian pork, only behind the United States.
Soybean and pea growers have also complained of Chinese red tape in recent months. Statistics Canada, the federal agency in charge of collecting official data, published a few days ago that Canadian exports to China fell by 19.2% in the first quarter of the year compared to the previous quarter. In the same period, imports from China fell 4%.
Meng Wanzhou, daughter of Huawei’s founder, will again appear in Vancouver court on September 23. This week, a Canadian parliamentary delegation is visiting China to request the release of Michael Kovrig and Michael Spavor, formally accused by Beijing of espionage, an action that Canada considers part of the retaliation for the arrest of the executive.
On May 21, when reporting on the trip by members of Parliament, Foreign Minister Chrystia Freeland admitted that relations between China and her country are “very difficult” in these times. Political analysts believe that the decision on Huawei’s participation in Canada’s 5G network could be known near or after the elections (they are scheduled for October 21) and, in turn, not a few jurists have expressed that the issue of Meng Wanzhou in court could last for months or years. It seems that the frictions between Ottawa and Beijing will not be left behind anytime soon.