Huawei says it has ‘significant work’ ahead to build trust in Canada

OTTAWA—Huawei Technologies Co. had a “tough month” in Canada and has significant work to do build trust in the country, Sean Yang, president of Huawei Canada, said in a speech to telecom industry officials. “It's been a tough month for us here in Canada. The report from the U.S. Congress has not been helpful, and for many Canadians who've never heard about our company before, we've got significant work to do to build trust. We understand this. Building this trust is not going to happen overnight,” Yang said at a conference hosted by the Ottawa chapter of the International Institute of Communications. Huawei and ZTE Corp., telecom suppliers based in Shēnzhèn, China, faced spying allegations this month in a report from the U.S. House of Representatives committee on intelligence, which recommended that American companies “consider the long-term security risks associated with doing business with either ZTE or Huawei for equipment or services.” Committee chair Mike Rogers, a Republican House Representative for Michigan, told CBC News in an interview at the time that he would extend the same committee recommendation to Canadian telecom companies. In Canada, Huawei supplies fourth-generation network equipment to BCE Inc., Telus Corp., and SaskTel. Yang said Huawei is an important player in Canada's information and communications technology sector, advancing technology and contributing to the country's research and development. “We're incorporated in Canada. We follow Canadian laws and regulations. We've never had an issue. As a company with $32 billion in annual revenue, we would never do anything to jeopardize or undermine the trust we know is critical to our long-term success,” Yang said. He said Huawei's top 10 Canadian suppliers in 2011 sold more than $32 million in telecom equipment to support Huawei's global operations. Those Canadian companies included PMC-Sierra, EXFO, SDP Telecom Inc., and Mitel Networks, he said. Yang said Huawei is working closely with IBM Corp., “one of the pioneers of globalization,” to follow its “best practices on management reform—from organization optimization to business flow restructuring.” The U.S. congressional report had suggested the Chinese government can exert influence over the corporate boards and management of private sector companies based in China due to their corporate structures. Yang cited data from the International Trade Center that said, in the United States, 85 per cent of all imported telecom and electronics is manufactured in China or South Korea. “There's a strong likelihood that some or all of every smartphone, computer and television projector in this room, in your home, and in your office, was manufactured in China,” he said. Scott Bradley, vice-president of corporate and government affairs at Huawei Canada, said in an interview with The Wire Report and The Lobby Monitor following the speech that there was nothing new in the congressional report that the committee chair had not “tossed against us previously.” Bradley said the report arrived at a bad time for the company given rising public awareness of Canada's trade and investment relationship with China. Chinese oil company CNOOC Ltd.'s proposed $15.1-billion bid for Canadian company Nexen Inc. has been in the headlines as the Conservative government reviews it under the Investment Canada Act. “We'd like to get back to the point that we have been in the marketplace for five years. There's never been an issue with us,” Bradley said. “We're not here to acquire companies. We're trying to partner with companies.” He said the onus is on Huawei to tell its story and broaden its customer base. He said the company will be telling its Canadian story more “in the months ahead" but did not provide details. “We're working hard to be open and transparent about the things that we're doing," he added. Bradley said Huawei is not a contender for a contract for government-wide network and email services, called the “email transformation initiative.” Andrew MacDougall, a spokesman for Prime Minister Stephen Harper, told reporters this month that the government may block Huawei from bidding on the project. “We're only starting to build that business, and this is for a secure government contract,” Bradley said. “We knew we would never be selected as the primary vendor. We'd only be, at some point, a sub of a sub in a specific project, and if those opportunities come along down the road, we would have to figure things out.” sdoyle@thewirereport.ca

Huawei says it has ‘significant work’ ahead to build trust in Canada

News | 10/30/2012 8:13 pm EDT

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