This week, the U.S. House Permanent Select Committee on Intelligence released a report citing concerns about Huawei and ZTE, two giant Chinese telecommunications companies, over threats of intellectual property theft and cyber espionage. The 52-page report is the product of almost a year of deliberation by the Committee, and anyone can access this report online.
The Chinese government has vociferously defended Huawei’s play in the American market and lambasted the U.S. for this week’s report. Government-run Xinhua news service accused the U.S. of “protectionism” and a “Cold War mentality.” The Chinese Foreign Ministry labeled the report “prejudiced” and an affront to U.S.-China trade. The PRC Ministry of Commerce stated that the U.S. report “violated [the United States’] long-held free-market principles and would undermine cooperation and development between the two countries.
Huawei and ZTE should only be part of the public discussion following this report. U.S. policymakers and the American media are missing a major opportunity provided by the Huawei decision and resulting hoopla — the opportunity to engage the Chinese government in a conversation about why many U.S. tech companies continue to be completely blocked in China without any notice, process, or justification. Given the high-profile nature of this issue, and the willingness of the Chinese government to publicly defend Huawei, there are a number follow-up questions that U.S. journalists and policymakers should be asking this week. Two of those questions must be the following:
1. Why is there no explanation of these restrictions to the Chinese market? Why is there not a process, similar to the one Huawei enjoyed in the U.S., for determining if a company should be blocked from the Chinese market?
Major Internet companies like Facebook, Dropbox, YouTube (owned by Google), and Twitter have each woken up one morning over the past several years to find that their service has been blocked for Chinese users. This restriction effectively prevents these companies from doing business in China. Google’s services like Google Drive, Picasa, and Google Plus are also blocked from the Chinese market.
Anyone who wants to debate the evidence or motivations behind the House Intelligence Committee’s report on Huawei and ZTE can read the Congressional report for his or herself. The public has no such opportunity regarding the Chinese government’s decisions to block Facebook or YouTube.
2. Why is the U.S. government silent on these issues? Why does the U.S. public take the blocking of these companies’ access to the Chinese market as a fait accompli, as something over which we have no sway?
A U.S.-China Business Council (USCBC) report released this week found that the top ten challenges to U.S. businesses in China included administrative licensing, business and product approvals (#2), competition with Chinese companies due to preferential policies and advantages (#3), uneven enforcement of Chinese laws (#6), and restrictions on foreign investment (#7).
And this list from the USCBC covers companies that have gained access to China.
The Chinese Government has weighed in forcefully on the subject of Huawei and ZTE. Now is a perfect opportunity for the U.S. government and the U.S. public to demand answers from China as to why some of America’s best, most innovative companies are blocked from doing business in China.