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Huawei is perhaps the most enigmatic company on the planet. The Chinese communications firm is not publicly listed, and despite being one of the world’s largest firms, basic information about its structure, ownership and business activities is difficult to unearth. It is not simply opaque from the outside; secrecy also pervades its internal culture. Most of the company’s own employees are reportedly unaware of the details of its inner workings, which are highly centralised within its Shenzhen headquarters.

Huawei’s notorious lack of transparency contrasts with a growing interest in the company throughout the West. Despite the attention the company has drawn, there’s no consensus on its nature. Many in the business sector emphasise its role as a major commercial player and, increasingly, as a technological innovator. In the wake of the government’s August 2018 pronouncement effectively excluding Huawei from Australia’s 5G mobile network, Vodafone’s Dan Lloyd condemned the decision as one that ‘fundamentally undermines Australia’s 5G future’. Other commentators stressed that the decision would increase the costs of developing 5G, which would only result in higher consumer prices.

Some observers downplay the commercial side and instead stress other, non-commercial, characteristics of the company. These analyses tend to emphasise the historical linkages between Huawei and China’s security apparatuses, as well as the capacity for the Chinese Communist Party to influence the company’s activities.

The truth is that Huawei has both commercial and strategic dimensions. It is a huge participant in the global market for communications hardware and of increasing importance in the field of technological innovation. No analysis of the company can neglect this aspect. At the same time, focusing unduly on its commercial characteristics misses a vital feature of Huawei: its function as an instrument of Chinese national strategy. Huawei is a private company that has been nurtured by the Chinese party-state for strategic purposes. Its capabilities, honed in commercial operations, are assets that can be (and in some cases already are) channelled towards China’s strategic goals.

The duality of Huawei’s business may appear novel or contradictory to the liberal West, accustomed as it is to clear lines of demarcation between commerce and government. However, it is not without historical precedent. As ASPI’s latest Strategic Insights paper, published today, demonstrates, Huawei’s development has strong parallels with that of Telefunken—a 20th century German company dedicated to wireless telegraphy.

The most fundamental similarity concerns the companies’ relationship with the state. Though they’re both private enterprises, Huawei and Telefunken received considerable support from the state during their initial growth phase. Hardware sales to the military provided vital early customers and the opportunity to gain practical experience. Protection of the domestic market shielded the infant companies from established overseas competitors, giving them the opportunity to grow. Once they were established, diplomatic support facilitated the opening up of emerging foreign markets not yet captured by international competitors. State support proved essential in boosting the competitiveness of these national firms against foreign competition.

Most importantly of all, both companies emphasised innovation from their inception, and were able to establish themselves at the leading edge of technological sophistication through indirect support from the state. In Telefunken’s case, it was able to access Germany’s national research networks—its world-class university system and the research divisions of electrical giants Siemens and AEG. This gave it an advantage in research and development over its foreign competitors in wireless, which didn’t have access to resources on a national scale. In Huawei’s case, the company’s intense focus on R&D has been facilitated by party-state connections, which kept the company afloat. It has also been able to access international expertise to boost its technological capabilities, particularly in Europe, where it has invested heavily in collaborative R&D facilities.

State support to boost both commercial competitiveness and technological innovation has proven instrumental in the rise of Huawei to global prominence, as was the case with Telefunken in the early 20th century. In both companies’ cases, this served the strategic goals of the state by promoting national capabilities in communications in order to escape dependence on other powers in this vital area.

The paper argues that national communications development for Wilhelmine Germany and contemporary China has two key strategic implications. One is geostrategic, pertaining to the deployment of communications infrastructure as an instrument of control over particular geographic areas. In Germany’s case it was its small and far-flung empire, whereas in China’s case it is an emerging sphere of influence, centred on Eurasia and the Indian Ocean, under the Belt and Road Initiative.

The other strategic implication relates to capacity-building, wherein commercial and technological progress increases national capabilities that can be steered towards non-commercial, particularly military, ends. In Telefunken’s case, the capacity developed during peacetime was a major asset for the German war effort from 1914, facilitating the innovative tactical and operational use of wireless communications on the battlefield. Today, Huawei is heavily involved in ‘civil–military fusion’, designed to facilitate the transfer of technologies between the commercial and military sectors of Chinese society. It is also a major participant in initiatives to develop dual-use technologies that will have significant implications for warfighting, including 5G, quantum cryptography and artificial intelligence.

Historical analysis has strong relevance for contemporary policymakers. Some may be tempted to dismiss it as a luxury or indulgence, of little relevance to the rapidly evolving technologies and circumstances of the 21st century. But historical analysis has an important role to play in relation to comprehending contemporary challenges. It provides a vantage point from which to examine our own times. By analysing past historical dynamics, it’s possible to identify parallels in the contemporary world. These suggest possible outcomes based on how similar situations played out in the past. A relevant historical example can provide hints of what might be around the corner. A heightened awareness of the past can place us in a better position to understand the present and anticipate the future.

The point is encapsulated in an aphorism often misattributed to Mark Twain: ‘History does not repeat itself, but it often rhymes.’ Familiarity with historical precedents can empower policymakers to anticipate the rhymes, and only strengthen policy responses to contemporary challenges.

There’s been a vigorous debate of late in Australia about the extent of Chinese government interference in domestic politics. Less has been said about what occurs on our university campuses. Pressure from the Chinese government comes in numerous ways, including censoring discussion topics, putting students from China under surveillance, and threatening those who participate in protests or events China deems sensitive.

The Australian government has focused more on Chinese political influence and on criminalising acts of foreign interference. It has also created a register to improve transparency of organisations and institutions working on behalf of foreign governments and political bodies.

Beyond these reforms, colleges and universities can do several practical things to protect academic freedom. After all, Chinese students enrol in our universities to get an Australian education and that should come with a strong guarantee of academic freedom.

Education is now Australia’s third largest export. In 2018, 255,896 Chinese students studied in Australia, nearly a third of the total international student cohort. University officials talk about the risks of being overly financially reliant on these students—but they’re barely talking at all about the risks that students from China are grappling with every day on those campuses.

Last month, Human Rights Watch released a 12-point code of conduct as a guideline for colleges and universities to respond to Chinese government threats to academic freedom. The code is based on more than 100 interviews between 2015 and 2018 in Australia, Canada, France, the United Kingdom and the United States with academics, administrators and students, including some from China.

Our research found that the Chinese state’s repressive apparatus follows students from China to Australia. Some university students from China have reported that other students from China monitor what they say and do. These students have described warnings by Chinese officials to refrain from criticising the Chinese government in classroom discussions. Several academics told Human Rights Watch about incidents in which Chinese students described intimidation of their families in China because of what students had said in the classroom, or because they joined certain activities or demonstrations.

Some China scholars in Australia also censor and self-censor critical discussions. Concerns and fears about getting visas, threats to students or colleagues, and fear of irking administrators and nationalist students are all factors. One academic told me, ‘Increasingly there are these “no-go zones” that very few people are willing to research, to give public comment on, especially controversial issues like Xinjiang and Tibet.’ Another said he had been discouraged from assigning his course a ‘sensitive’ title. Many of those we interviewed said they modified their remarks inside and outside the classroom for fear of not being able to visit China or of losing funding sources, or of causing problems for Chinese students.

Many academics described discomfort with the presence of Confucius Institutes, which offer classes in Chinese language and culture, on their campuses. While this sounds like the British Council or Alliance Française, in fact the institutes are effectively outposts of China’s education ministry and are fundamentally incompatible with a robust commitment to academic freedom.

Confucius Institutes actively take steps to censor certain topics and perspectives in course materials on political grounds and take political loyalty into consideration in hiring decisions. Chinese Communist Party speeches have openly described the institutes as ‘an important part of China’s overseas propaganda set-up’. Victoria University in Melbourne cancelled the screening of a documentary critical of the institutes after the university’s own Confucius Institute complained. In the US, several universities have closed or announced the closure of Confucius Institutes in part because of concerns about academic freedom. The 13 Australian universities with Confucius Institutes should seriously consider following suit.

The code of conduct provides other practical measures that universities can take to support both academic freedom and freedom of expression. For instance, universities can express commitments to these ideals though public documents, institutional policies and internal guidelines. And they should ensure that students are aware of policies in support of academic freedom, by including those commitments in orientation materials, handbooks and honour codes. The code also urges universities to work together and make joint statements and complaints with other universities in response to visa denials or other obstacles to research in China.

Besides these active measures, universities also need to respond forcefully to harassment, intimidation and threats to academic freedom. Tracking incidents of Chinese government infringements against academic freedom, including reporting annually on the number and nature of such incidents, and developing robust independent systems so that acts of retaliation or pressure can be privately or anonymously reported, are key.

Equally important, Australia needs to ensure that students and scholars from China feel truly integrated and supported, so that they are less reliant on organisations with ties to the Chinese government, including the Chinese Students and Scholars Association. Not only should all campus organisations be required to disclose their ties to foreign governments, but universities themselves should annually disclose all sources and amounts of funding that come directly or indirectly from the Chinese government.

Given the behaviour of the Chinese state, having many students from China studying in Australian universities means that safeguarding academic freedom can’t be taken for granted. As one academic told me, ‘One of our biggest failings as universities in Australia is that we don’t try to critically engage with those students in terms of their views about their country. Intimidation but also our increasing dependency on China leads to self-censorship and making decisions that are detrimental to academic freedoms.’

China’s problem with terrorism has until recently been largely isolated to the Xinjiang Uyghur Autonomous Region in the far northwest of the country. However, that’s been changing as Uyghur militancy and terrorism increasingly impinge on Chinese interests in Central Asia, South Asia and the Middle East. China’s response to terrorism is now marked by domestically and internationally oriented postures.

Domestically, Beijing’s explicit framing of Uyghur opposition as directly inspired or supported by externally based militant jihadist organisations has been used to justify the Chinese Communist Party’s (CCP’s) implementation of a pervasive security state in Xinjiang and the mass internment of up to a million Uyghurs in ‘re-education’ facilities.

Internationally, the existence of Uyghur militants abroad (particularly in Afghanistan and Syria, fighting under the banner of the al-Qaeda-affiliated Turkestan Islamic Party), combined with President Xi Jinping’s signature foreign policy agenda, the Belt and Road Initiative (BRI), has ensured that counterterrorism is now a prominent interest in Chinese diplomacy throughout Central Asia, South Asia and the Middle East.

Since 9/11, China has labelled incidents of violence in Xinjiang as the work of the al-Qaeda-aligned (and originally Afghanistan-based) East Turkestan Islamic Movement and Turkestan Islamic Party. However, there’s little evidence that either of those groups ever successfully mounted an attack in Xinjiang.

Nonetheless, a number of high-profile terrorist attacks in or related to Xinjiang in recent years—such as the October 2013 SUV attack in Tiananmen Square and the April 2014 Kunming railway station mass stabbing attack—prompted the CCP to embark on a ‘people’s war against terrorism’ that has resulted in significant changes in the ideological, legal and institutional underpinnings of Chinese counterterrorism policy.

The regional government’s expenditure on public security ballooned in 2017, amounting to approximately US$9.1 billion, a 92% increase on such spending in 2016. Much of the money has been absorbed by the development of a pervasive, hi-tech ‘surveillance state’ in the region. The system includes facial-recognition software and iris scanners at checkpoints, train stations and petrol stations; biometric data-collection for passports; mandatory apps to cleanse smartphones of potentially subversive material; surveillance drones.

Significantly, the system relies not only on technology but also on manpower to monitor, analyse and respond to the data it collects. Its rollout has thus coincided with the recruitment of an estimated 90,000 new public security personnel in the region.

Over the past few years, China has introduced a suite of counterterrorism laws, starting with national legislation in December 2015, followed by legislation for Xinjiang in August 2016 and regulations on ‘de-extremification’ in Xinjiang in March 2017. Much of the legislative agenda has been explicitly framed by the Chinese authorities as constituting a preventive approach akin to that undertaken under the rubric of ‘countering violent extremism’ by a variety of other states to address the causes of terrorism.

Central to that approach is the concept of ‘de-extremification’. According to the Xinjiang regional government’s own March 2017 regulations, ‘extremification’ refers to ‘speech and actions under the influence of extremism, that imbue radical religious ideology, and reject and interfere with normal production and livelihood’ and can include 15 ‘primary expressions’ of ‘extremist thinking’, including wearing beards, headscarves and veils and selecting ‘irregular’ names for Uyghur children.

‘Extremism’ is therefore clearly identified as inherent to everyday markers of Uyghur identity, resulting in the securitisation of ‘all religious behaviours, not just violent ones’.

Uyghurs are now conceived of as an almost biological threat to the health of society. Government officials have described Uyghur ‘terrorism’ as a ‘tumour’ to be eradicated and Islamic observance as akin to drug addiction. The mass detention and ‘re-education’ centres thus emerge as part of the CCP’s ‘cure’ for such pathologies.

As dystopian and disturbing as this is, it’s also now clear that China is seeking to both embed its Xinjiang-centric counterterrorism focus within its diplomatic relations and export the methods and technologies that have underpinned its ‘surveillance state’ in Xinjiang.

Beijing has pushed its counterterrorism agenda in the Shanghai Cooperation Organisation in Central Asia since its founding in June 2001, focusing the organisation on combating the ‘three evils’ of ‘separatism, terrorism and extremism’. This has included regular ‘anti-terror’ exercises by SCO militaries, intelligence sharing, and closer police and law enforcement cooperation between Russia, China, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Of particular note have been agreements for the ‘guaranteed extradition’ of individuals on shared ‘blacklists’ in violation of international law.

China is also seeking to target the Uyghur diaspora beyond its borders—including in Australia—with its system of surveillance by creating ‘a global registry of Uighurs who live outside of China, threatening to detain their relatives if they don’t provide personal and identifying information to Chinese police’.

Potentially more far-reaching is the fact that Xi’s multibillion-dollar BRI is intended to invest not only in physical infrastructure, but also in the infrastructure and technology necessary to create a ‘digital Silk Road’. Much of the investment is coming from many of the same tech companies—such as Alibaba, Huawei and ZTE—that have been heavily involved in establishing the surveillance apparatus in Xinjiang. That experience has enabled them to ‘incubate’ and ‘mature within a strict set of Chinese controls and grow profitable before going global’.

Beijing’s focus on the ‘digital Silk Road’ has provided these companies with expansion opportunities in a variety of BRI partner countries as far afield as Zimbabwe, Venezuela, Malaysia and Mongolia.

Ultimately, the evolution of China’s counterterrorism efforts amounts to a cautionary tale in the ‘war on terror’.

China has effectively instrumentalised the threat of Uyghur ‘terrorism’ both within its domestic governance of Xinjiang and in its diplomacy to repress and control Uyghur identity and autonomist aspirations. Its more recent efforts at forging the ‘digital Silk Road’, meanwhile, raise the possibility that the ‘presence of Chinese engineers, managers, and diplomats will reinforce a tendency among developing countries, especially those with authoritarian governments’, to adopt China’s approach of ensuring that technology serves the interests of a homogeneous state.

It doesn’t get much bigger than attacking the home of democracy—parliament house—and a country’s major political parties only months out from a federal election.

In his statement on these attacks, Prime Minister Scott Morrison said there was no evidence of ‘electoral interference’. But elections aside, there is a much broader question here about what these attacks might mean.

By being caught with its hands squarely in the cookie jar, this ‘sophisticated state actor’ guaranteed that its actions would garner global media attention. It has also, likely unintentionally, placed itself smack in the middle of an ongoing public debate about ‘foreign interference’ in Australia.

Let’s cut to the chase: Chinese state intelligence was probably involved in the breach. This was a sophisticated attack that used a suite of new malware and techniques that—at the time—weren’t detected by almost all malware-detection software. Building a new toolset of this type takes considerable time and effort, and although Russia, North Korea, Iran and Israel undoubtedly have the capability, Australia is simply not a high enough priority for those countries to expend their finite cyber espionage resources on this kind of advanced attack. The Chinese state, however, has the motive, the capability and an extensive track record.

But we will only know who is responsible for the attacks if the government chooses to tell us, and that’s where things get tricky.

The Australian government has been reluctant to ‘name and shame’ states engaged in cyber operations—what is known as ‘attribution’. It has formally blamed Russia several times for malicious cyber behaviour that hasn’t involved obvious Australian interests, but has named China only once. In that December 2018 attribution, which occurred after Chinese hacking in Australia that affected industry, universities and think tanks, the government focused on the theft of intellectual property for commercial gain and was drawing a distinction between ‘acceptable’ intelligence that seeks to uncover government or military secrets and ‘unacceptable’ intelligence for commercial advantage.

It is also notable that this formal attribution was conducted collectively with many other affected countries. Safety in numbers matters when China’s approach to international engagement is taking an increasingly coercive and vengeful tone. And let’s face it, while it may not be effective in dissuading further attacks, remaining silent is often the more palatable option from a political and diplomatic perspective.

So the first prerequisite for the Australian government to formally name the attacker would be for its purpose to have been ‘unacceptable’ espionage. In parliament and political parties there wouldn’t be much commercially valuable intellectual property at stake, but perhaps this attack could be a form of foreign interference?

It’s clear that this act of cyber espionage isn’t, in and of itself, an act of foreign interference. Intelligence, at least in Western countries, is typically used to gain insights and to inform our government positions and plans. From this perspective, the highest priority targets would be government departments and ministers, but it’s not hard to imagine how information about the powerbrokers and personalities of parliament could be used to refine and hone a foreign government’s posture and diplomatic approach.

Another possibility that doesn’t involve foreign interference is that the hacker was after our political parties’ campaign databases. There is already good evidence that Chinese state intelligence is hoovering up large datasets to enhance its intelligence-gathering and counter-intelligence efforts. If Chinese state intelligence was behind this attack, it’s possible that these comprehensive campaign databases could be a useful addition to the data they have already collected.

It is worrying, however, that the Liberal, Labor and National parties were targeted. The more that intelligence-gathering extends beyond government and parliament, the less likely it is that any intelligence gained will provide any insight into official government positions, and the more useful it would be for interference activities.

One way this espionage could be used for foreign interference is—as seen in the 2016 US presidential election—through the release of stolen campaign emails to damage a particular party or candidate and sway public opinion. But this tactic is now embedded in the public consciousness and our political parties and media could well respond in a way that is detrimental to the attacker.

But a far subtler, more covert, and much more difficult to detect form of foreign interference could be the use of the stolen information to identify politicians and staffers who may be susceptible to influence, enable future relationships with them and find points of leverage that might convince, cajole or coerce them into a supportive position. An in-depth understanding of our political parties and the machinations of parliament—the exact targets of this hack—would be far more helpful in enabling this kind of interference than it would be in illuminating our official decision-making processes.

Forensic investigation of these breaches is difficult and time-consuming, and the attacker took active steps to hide its tracks. The investigation is in its early stages, and the culprit may never be officially identified, but knowing what was stolen will be key to formulating a response and preparing for any interference that may occur in the future.

This attack may never be classified as electoral interference, but the very public statements made by Morrison in parliament—the scene of the crime—make it unlikely that it will be brushed under the carpet. While the short-term focus is on securing the systems in parliament and our political parties, we also need to face the far more difficult, long-term task of protecting our political systems and democracy from undue influence.

If the past year is any indication of the year ahead, US policy in Asia will be erratic and self-serving. The beginnings of an Indo-Pacific strategy notwithstanding, the Trump administration continues to work out its issues with countries in the region bilaterally and sporadically.

Donald Trump’s trade confrontation with China is yet to produce a negotiated solution. The challenge is structural and no amount of Chinese promises to ‘buy American’ will fix the underlying problems.

The challenge posed by Chinese companies is felt far beyond the US government. The Department of Justice’s enforcement of US law on companies accused of commercial espionage and cyber theft is only strengthening. Beyond the high-profile detention in Canada and pending extradition of Huawei’s CFO Meng Wanzhou, numerous indictments of Chinese companies are being pursued.

Without real change in Beijing’s enforcement of intellectual property theft, simply shifting the trade balance towards a more favourable direction for the United States will be insufficient to address the economic strain.

Trump’s approach to China is not only about commerce. Vice President Mike Pence’s speech in October made that clear. A wide-ranging critique of China’s behaviour in the US and efforts to expand its influence abroad, the speech was welcomed by some in Asia as evidence that the US is ready to stand up to China.

But across the Indo-Pacific a more openly pugilistic US relationship with China unsettles nerves. Is it a ‘new cold war’? Not yet, but the US and China are clearly on a deeply contentious path. It’s an open question whether Washington is up to the challenge of engaging in sustained, strategic competition with Beijing and whether it can maintain the like-minded regional coalition that will be necessary.

A second challenge for Washington is realising the promise of threat reduction claimed by Trump and North Korean leader Kim Jong-un in Singapore. The president is fond of declaring his administration’s diplomacy with Kim a success, but his own intelligence agencies disagree that North Korea is prepared to denuclearise.

Over the past year, to be sure, there were no missile or nuclear tests. Yet there was also no progress in getting Pyongyang to catalogue its nuclear and missile facilities or to open its production sites for international inspection. The on-again, off-again diplomacy to set up a second summit suggested a major setback. But Trump and Kim will now meet in Vietnam on 27 and 28 February.

Perhaps the most pervasive problem for US foreign-policymakers is not the behaviour of other global actors, in Asia or elsewhere. Crippling divisions within the Trump administration itself, and between the administration and the legislative and judicial branches of the US government, could make any attempt to marshal US resources into foreign relations almost impossible.

With the government shutdown, the Mueller investigation and its criminal indictments, and the increased scrutiny of Congress on the administration, it will be a year of domestic entanglement for the president and his White House.

The foreign policy consequences of this domestic turbulence cannot be overlooked. Already, the Trump administration’s decision-making has led to the loss of advisers with critical foreign policy expertise, such as former defence secretary Jim Mattis. There also seems to be a much-diminished capacity within the White House for organised intra-agency debate over US strategic priorities.

Some think that the president is now more empowered to act in line with his ambitions, and so foreign policy will become more aligned with his ‘America First’ premise. Perhaps that’s true. But even if there are fewer experts in the government to challenge Trump’s vision, he will still have to implement his goals. And that may become more difficult than ever.

Frustrations at home could just as easily produce even more brittle and reactive decision-making by the president, making it impossible to reach or implement meaningful agreements with others around the globe. Also worrisome is that, with all this domestic contest, the Trump administration will be overly eager to create evidence of foreign policy successes. Prematurely declaring victory in the trade war with China or in negotiations with North Korea could leave the region, and the globe, less stable.

As former deputy secretary of state Antony Blinken pointed out, for all the Trump administration’s breathless talk of crises, the president has yet to face a real challenge to US interests. A crisis could expose the administration’s haphazard decision-making procedures and its intragovernmental divisions. Congress is growing more active in trying to assert its role in a crisis, with some members proposing limits on the president’s use of nuclear weapons.

US success in mitigating strategic tensions with China is unlikely, and no US president has yet found the magic solution to persuading Pyongyang to abandon its nuclear quest.

Nor does Washington seem well placed to assist its friends and allies with their own problems. Of particular concern is the deteriorating relationship between Japan and South Korea. This is a moment that cries out for diplomatic assistance from countries like the US, which see what the heightened risk of a military clash could mean for the future of Northeast Asia.

Add to that the alarming signs that Trump really does want to step back from US treaty commitments to allies in NATO, South Korea and perhaps even Japan, and 2019 could end up being a far bigger watershed in US policy towards Asia than anyone cares to imagine.