Huawei has warned up to 1,500 employees of its Australian contractors could lose their jobs unless Canberra reverses a decision to ban it from providing 5G telecommunications equipment, reflecting how national security concerns in the west threaten its expansion.
The Chinese equipment maker also vowed on Monday to pursue legal claims more aggressively against organisations which it alleges are making “false and malicious attacks” on its reputation in Australia and elsewhere.
Huawei has appointed a law firm co-founded by Nick Xenophon, a former politician, which it said would counter misleading statements by entities with “strong vested interests”.
This focus on countering criticism comes as the world’s biggest telecoms equipment vendor seeks to minimise the commercial impact of closer scrutiny of its operations in western countries.
Last week, Spark New Zealand, a telecoms operator, confirmed it had abandoned plans to rely exclusively on Huawei for its 5G rollout following concerns expressed by the nation’s intelligence agency.
Huawei’s market share in Australia for 4G
“Every smear against Huawei is also a smear against our hard-working staff and we want to make sure the important discussion around cyber security is based on facts and not baseless innuendo that is unfortunately dominating the current discussion,” said Jeremy Mitchell, Huawei Australia’s director of corporate and public affairs.
Last year, Australia became the first country to effectively ban Chinese equipment makers Huawei and ZTE from providing 5G equipment on national security grounds. The decision has sparked a contentious debate about whether it is safe to let Huawei build the next generation of mobile networks.
That debate is particularly fierce among members of the Five Eyes intelligence community — the US, UK, Canada, Australia and New Zealand — amid concerns that president Donald Trump could threaten to limit intelligence sharing with nations that give Huawei a 5G role.
On Monday, Scott Morrison, Australia’s prime minister, defended Canberra’s decision to exclude Huawei from the national 5G network, telling reporters it was “in the national interest” as he launched a task force to tackle foreign interference activities.
In Australia, where Huawei commands a 55 per cent market share in 4G, the company said on Monday its pipeline of work will dry up by the end of 2020 unless the 5G ban is reversed. The company has already cut 100 of its 800 jobs in Australia and has warned up to 1,500 jobs at suppliers and contractors are at risk due to the ban.
“Our suppliers are overwhelmingly small to medium-sized businesses employing about 30 people and in many cases Huawei is currently delivering around 80 per cent of their annual revenues — so without us they are in huge trouble,” said Mr Mitchell, according to prepared remarks ahead of a speech on Monday evening to Huawei’s suppliers.
“We hope common sense prevails and that Huawei is ultimately allowed to deliver 5G in Australia in the way we are already doing in the UK, South Korea, Switzerland, Spain and many others.”
Mr Mitchell did not name any of the organisations that Huawei alleged have unfairly criticised the company. But a Huawei spokesman alleged the Australian Strategic Policy Institute, a think-tank that has called for Huawei to be excluded from supplying 5G on national security grounds, had consistently sought to damage the company’s reputation.
“ASPI . . . receives substantial funding from a range of foreign stakeholders — most notably American arms and defence manufacturers,” the spokesman said. “There is a clear conflict of interest here that isn’t being highlighted.”
ASPI declined to comment.