Huawei's 4G project in South Korea to push forward, despite US concerns

A HK$1.8b agreement with LG unit prompts warning from lawmakers in Washington that security ties with Seoul could be threatened

PUBLISHED : Thursday, 05 December, 2013, 6:00am
UPDATED : Thursday, 05 December, 2013, 6:00am

Months after whistle-blower Edward Snowden revealed wide-scale internet spying by US intelligence agencies, Washington has sounded an alarm over what it says is the security threat posed by Chinese company Huawei Technologies.

The renewed scrutiny by the United States of Shenzhen-based Huawei, the world's second-largest supplier of telecommunications equipment, was prompted by the company's 250 billion won (HK$1.8 billion) deal for a high-speed 4G mobile project with South Korean telecommunications network operator LG Uplus.

"It all goes back to the hypothetical suspicion levelled at us that our equipment could be used on behalf of the Chinese government for espionage," Huawei spokesman Scott Sykes said yesterday. "That has never happened. There are no facts or proof of any kind behind that accusation."

US lawmakers Dianne Feinstein and Robert Menendez - respectively, the heads of the Senate intelligence and foreign relations committees - have raised concerns that Huawei's participation in the project could threaten longstanding defence ties between the US and South Korea.

Their warnings echo a US congressional report published in October last year that branded Huawei, ZTE and other Chinese telecommunications equipment makers as security threats and recommended their exclusion from major infrastructure projects.

Despite the red flags raised by its politicians, Washington will likely be disappointed by the response from Seoul.

LG Uplus, a subsidiary of conglomerate LG Group, plans to push forward with building a nationwide mobile network with Huawei based on the 4G technology called long term evolution (LTE).

"Concerns over using Huawei-provided technology are overblown, as domestic telecoms operators entirely handle their own networks," LG Uplus spokeswoman Kim Yoon-ok said in a report in yesterday's Korea Times.

"There could be security concerns using Huawei technology in the United States, the United Kingdom and Australia, as telecoms equipment vendors are managing operations and maintenance on a contractual basis in those countries," she said.

"In Korea, the situation is completely different. Possibilities of data leakage and spying are very low."

The report added that the government in Seoul had no immediate plans to intervene.

For Huawei, the confidence showed by its partner in South Korea could well represent an important breakthrough in fighting aspersions on its reputation, which have seen it shut it out of the lucrative telecommunications infrastructure market in the US.

"Huawei is not China. Huawei is Huawei, a technology company," Sykes said. "We've said that we would never jeopardise our commercial success for the Chinese government or any government.

"Our gear is world-proven and trusted. About 2.5 billion people around the world are connected by Huawei equipment. The motivations of those that might groundlessly purport otherwise are puzzling."