Huawei at Center of Pacific Cable Spat

Huawei has run into trouble yet again with Australian authorities -- this time over a subsea cable from the Solomon Islands.

The Australian government has told the small Pacific island state that it will not allow the cable to land in Sydney if it issues the contract to Huawei, the Sydney Morning Herald has reported.

Solomon Island Submarine Cable Co. (SISCC) signed an MoU with Huawei's marine business for construction of the 4500km, 2.5Tbit/s cable early this month. The contract is valued at $68 million.

But on a visit to Honiara last month, the head of the Australian Secret Intelligence Service (ASIS), Nick Warner, told Prime Minister Manasseh Sogavare that Australia would not issue a license for a Huawei-built cable. Any other cable supplier would be acceptable, the Island Sun reported.

Huawei Technologies Co. Ltd. is considered a security risk by the Australian and US governments and its network gear is banned in both countries.

Canberra was alarmed when in the middle of last year the Solomon Islands suddenly dropped its plans to sign up an unnamed US-British firm and began pursuing Huawei. The Asian Development Bank, which would have provided financing, also withdrew because of the switch.

The most likely explanation is that Huawei, backed by cheap credit from a Chinese state bank, stepped in with a much lower price.

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The South Pacific is an area of diplomatic competition between China and the US and its allies, with China a welcome financial benefactor to the hard-pressed island states.

For Huawei, it is a return to the battles that it fought unsuccessfully in Canberra and Washington early this decade. It is banned from supplying fixed-broadband equipment to Australian operators, including the NBN project. However, it is permitted to supply Australian mobile infrastructure.

For the Solomon Islands, east of Papua New Guinea, the new cable is a big deal. Its population of 642,000 people over an area of 11,000 square kilometers currently relies on satellite for Internet and voice communications.

— Robert Clark, contributing editor, special to Light Reading

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