Huawei industrial espionage in Poland leads to calls for boycott

And the Czech cybersecurity agency said Chinese laws “force private companies with their headquarters in China to cooperate with intelligence services,” which could make them “a threat” if involved with a country’s key technology.

Germany is under growing pressure from the United States to follow suit. The country has relatively good relations with China, which is why Berlin has sought to keep a distance from the U.S. aggressive trade approach toward Beijing.

But Western intelligence services say that China is employing around one million intelligence agents, many of whom are focused on obtaining German technologies. The German Interior Ministry estimates that Chinese economic espionage could cost Europe’s largest economy between €20 billion ($22.9 billion) and €50 billion a year.

“Germany is an important target for Beijing, because its companies are world-class in areas the Chinese Communist Party considers strategic,” Peter Mattis, research fellow in China Studies at the Victims of Communism Memorial Foundation, told DW

The country’s biggest telecoms firm, Deutsche Telekom, said recently it was reviewing its vendor plans in Germany and other European markets where it operates. According to the Bundesnetzagentur (BNetzA), the German Network Agency in charge of Germany’s 5G auction, security is not included in the conditions for awarding the contract. And some agree this is the way to go.

“I think Germany is right to not blindly follow any foreign advice regarding Chinese 5G manufacturers,” Jan-Peter Kleinhans, project director for IoT Security at Berlin-based think tank Stiftung Neue Verantwortung, told DW.

Kleinhans believes China conducts extensive industrial espionage, but that this should not be conflated with 5G. “Banning Chinese 5G manufacturers from public procurement because of fear over industrial espionage does not make sense,” Kleinhans says.

Kleinhans said that Huawei already provides about 45 percent of Germany’s 4G base stations and so far there has been no case in which they have been exploited for industrial espionage.

“It is technically possible but absolutely not efficient to use base stations for industrial espionage. It is much easier to use ‘conventional’ attack vectors such as phishing mails or other means of network exploitation to compromise a network and establish persistent access to then be able to steal blueprints, data,” he says.

It is difficult to assess these threats from outside the security community, David Kennedy, a telecom analyst, said. “But there have never been any reported instances of backdoors or anything similar in Huawei equipment,” he told DW.

Huawei, for it spart, is making an effort to prove its good faith. It has opened test labs for its equipment in Germany and the United Kingdom in cooperation with the governments there, and is to launch another in Brussels by the end of the first quarter.

Huawei rotating chairman Guo Ping in late December complained that his company was being subjected to “incredibly unfair treatment.”

“Huawei has never and will never present a security threat,” Guo wrote in a New Year’s message to staff.

Europe is an important market for Huawei, whose combined sales for Europe, the Middle East and Africa accounted for 27 percent of overall group sales in 2017, mostly as a result of spending by European operators.