updated 07:50 pm EST, Sat November 10, 2012
Communist party officials reiterate denials of espionage charges
During China's 18th Party Congress Communist party meeting, China's commerce minister decried US fears that Huawei posed a security risk. The US House of Representatives Intelligence Committee warned art month that the Chinese government could be using Huawei and ZTE-made equipment for espionage purposes. The report claimed that the presence of a Communist party cell in the management of both companies was the primary reason for the concern.
"Can you imagine if China started asking U.S. companies coming to China what their relationship was with the Democratic or Republican parties? It would be a mess," said Chinese Commerce Minister and Communist party member Chen Deming. All Chinese state-owned businesses and a large number of private firms have a Communist party secretary among the top management officials. Neither Huawei nor ZTE are state owned.
Executives for both Huawei and ZTE denied the allegations from the intelligence committee hearing report, claiming to not be controlled by the Chinese government. Former US government foreign technology analyst Jim Lewis was asked if Huawei were ordered by the Chinese government to spy on the US, and he answered that said "the state tells them what to do and they do it."
US officials skeptical of ZTE's motives found those fears supported in part when the company admitted earlier this year that its Score smartphone model -- and perhaps other models -- contained a hardwired backdoor exploit allowing anyone with knowledge of its hardwired password to take control of the handset. ZTE maintains that the feature was meant only to push software updates, though security experts contend there are much less suspicious ways to accomplish that.
ZTE claims that it is being as forthcoming and transparent with US government officials as possible and will cooperate with regulators. A statement from the company said that ZTE will look to demonstrate to the US Congress its "unique ability" to provide cyber security solutions both for congress and the executive branch.