China urges Australia to create fair biz environment

By Chen Qingqing Source:Global Times Published: 2018/8/23 20:48:41

Huawei ban will hurt progress of Australia’s 5G industry, says expert


China urged the Australian government to discard ideological biases and create a fair environment for businesses after Chinese telecom firms Huawei and ZTE were reportedly banned from providing 5G technology in the country.

Cooperation between China and Australia has always been mutually beneficial, and Australia should not use any excuse to artificially set obstacles or adopt discriminatory practices, Chinese Foreign Ministry spokesperson Lu Kang said at a daily briefing on Thursday.

Lu's remarks come after Huawei's Australia affiliate said on Twitter on Thursday that it was informed by the Australian government that Huawei and ZTE have been banned from providing 5G technology services in the country.

Huawei called the move "extremely disappointing" for consumers.

The security of 5G networks will have fundamental implications for all Australians, the Australian government said in a statement on its website on Thursday.

It added that the Australian government considered "the involvement of vendors who are likely to be subject to extrajudicial directions from a foreign government that conflict with Australian law, may risk failure by the carrier to adequately protect a 5G network from unauthorized access or interference."

The statement did not specifically mention Huawei and ZTE.

The Australian government has seriously violated the principles of fair competition and non-discrimination in free trade, and Huawei will take legal measures to safeguard its legitimate rights and interests, the company said in a statement sent to the Global Times on Thursday.

The Australian government is using security as an excuse to shield its political moves, said Huawei. "However, Huawei has never received any request from the Chinese government to gather information," the company said, adding that misjudgments and biased attitudes should never be a reason for security concerns.

The ban shows that the Australian government is completely biased toward Chinese companies, which contradicts the spirit of the free market that it values, said Ruan Zongze, executive vice president of the China Institute of International Studies.

"The Australian government becomes paranoid when it comes to matters involving China, which is terrible and absurd," he told the Global Times on Thursday.

Ruan said politicizing business, as in the case of the Huawei ban, is against the free trade agreement signed between China and Australia, and will eventually hurt the Australian 5G industry. 

Higher costs

It is a huge loss for Australia's 5G development, as local companies may have to spend more to build and upgrade their networks, Xiang Ligang, chief executive of telecoms industry news site cctime.com, told the Global Times.

The ban will lead to higher costs in building 5G networks in Australia, "which could be 30 percent higher," he said.

Huawei and ZTE would have competed with some of the world's biggest tech companies in the Australian market, such as Ericsson and Nokia. But with the ban, the latter two will deliver services at higher prices and charge higher management fees, the expert added.

Outside of the US, Huawei is expected to be a major supplier of 5G radio and core network gear, according to a report released by British industry intelligence unit Ovum in June 2017. Although ZTE is performing well in China, it still lags behind Ericsson, Huawei and Nokia in other markets, the report noted.

Australia will experience very slow progress in its 5G development now that it has blocked these Chinese companies, which was a political move, Fu Liang, a Beijing-based telecoms industry expert, told the Global Times on Thursday.

"However, it's still too early to say that Chinese companies will lose all their opportunities in the Australian market," he said.

Other Western countries are unlikely to follow Australia in blocking Huawei over security concerns, experts predicted.

"Australia followed in the footsteps of the US [by going against China in such a manner], but other countries are unlikely to follow suit," Xiang said.




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