For those of us who spend our lives in the bubble of the international telecoms industry it was not exactly a massive surprise to see the news that Chinese vendor Huawei would be blocked from bidding for work on the country’s A$38 billion ($40 billion) National Broadband Network (NBN).
Rumours had swirled for months that Huawei would be blocked from the NBN on the back of security concerns and this was finally confirmed on March 25th in the local press – although the government itself did not issue a definitive confirmation of the decision in its own statement.
Although Huawei had been privately aware that it had been blocked from the NBN since late last year, with its local management being advised of the fact by key officials in Canberra, the breaking of the news still caused a massive stir in the Australian market, with the development being reported even on mainstream TV news programs.
Following Uncle Sam
Given the fact that no Australian government ever wants to have more than a cigarette paper of distance between its own trade and foreign policies and those of its big brother in Washington DC, the NBN block on Huawei was inevitable given the company’s still parlous position in the US market.
For a variety of security and trade related reasons the US government – across both administrative and legislative branches – continues to have major concerns about Huawei and has blocked the company from competing for many projects in the country.
As a result, it would have been hugely embarrassing for the Americans if Australia – its staunchest international ally – had allowed Huawei to bid on a state sponsored project like the NBN. This would have significantly advanced Huawei’s international credibility and left the US as something of an outlier in its continued opposition to the company.
Indeed, news reports have made it quite clear that the US political and intelligence forces have lobbied Canberra hard to block Huawei from the NBN project. The Australian government, faced with choosing between its long running US alliance and its burgeoning partnership with China, plumped for the former over the latter.