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In an interview in China, Eric Xu tells the Financial Post Canadians should not equate the company with its homeland
SHENZHEN, CHINA – Huawei is just as trustworthy as a Canadian company, according to one of the telecom giant’s top executives, as the Chinese equipment maker works to boost its reputation in the face of growing concern over its ties to Beijing.
Huawei’s rotating chairman Eric Xu said there has been a “misunderstanding” between Canadians and Huawei, the world’s largest equipment supplier, resulting from the arrest of the company’s chief financial officer Meng Wanzhou. Meng is facing extradition to the United States on fraud charges.
“To a certain extent [Canadians] equate Huawei to China,” Xu said in an interview with reporters at Huawei’s lush campus in Shenzhen.
Echoing an argument made by founder Ren Zhengfei, Xu said the company would rather fold than obey a Communist Party request to access its equipment to spy outside China’s borders – even if the request came from President Xi Jinping himself.
“People may ask, ‘Why trust Huawei?’ It’s like asking, ‘Why trust Canadian companies?’” Xu said.
Despite a decade of smooth operations in the 3G and 4G mobile networks, Huawei’s status as a supplier to Bell and Telus could be jeopardized if Canada follows the U.S. lead and bans Huawei gear from 5G networks over concerns that the Chinese state could use it for espionage.
With Ottawa poised to make a decision on the matter in the coming months, Huawei continues to struggle with the intense scrutiny it’s been under since Meng was arrested in December. China subsequently detained two Canadians and accused them of spying, sparking a diplomatic crisis.
Xu said he expects time will help rebuild trust, comparing Huawei’s struggles with the challenges Boeing faces after two of its new Boeing 737 Max 8 airplanes crashed resulting in mass fatalities.
“We used to place our trust on Boeing, but now we don’t know,” Xu said. “Maybe people do not have as much trust today, but maybe after two years people would trust them again. I think that’s the same situation for Huawei.”
(The comparison with Boeing came the same day China ordered 300 jets in an estimated US$34-billion deal with Airbus, Boeing’s French competitor.)
Xu said he personally approved Huawei’s first research centre in Ottawa, where 5G research takes place. He praised Canada’s universities – Huawei invests millions in research and development at Canadian institutions annually – and said Huawei wants to work with the government to bring broadband to remote areas such as Nunavut.
When it comes to security, Huawei has worked with telecom operators and the Canadian Security Establishment to test its equipment to ensure it meets Canada’s standards. It has a similar system in the United Kingdom, and Germany last week said it will adopt a similar process rather than banning a single supplier.
“Singling out Huawei will not address cyber security concerns,” said Xu, noting cyber security is still a concern in the U.S. even though Huawei doesn’t have a presence there.
Xu said he doesn’t expect the U.S. to change its mind on a ban, adding it would be a “waste of our resources” to try. Instead, Huawei is putting in time with countries such as Canada, where the government has traditionally been willing to discuss security protocols.
It’s also pursuing a new media strategy, making formerly reclusive executives available for media interviews and taking reporters from Canada and around the world on tours of its campus.
Yet Xu acknowledged that it’s impossible to fully erase suspicions when he can’t prove that Huawei will never engage in bad behaviour in the future. He wouldn’t address the ongoing U.S. lawsuits against Huawei, but said Canada, China and Huawei are all “victims” in the ongoing drama.
“A lot of suspicions and accusations around Huawei are not built on evidence, a lot of them are based on assumptions and the identity of Huawei as a Chinese company,” he said.
By Emily Jackson
Copyright Postmedia Network Inc., 2019