The fun’s over for Mark McGowan as Huawei woes grow

Premier Mark McGowan has had plenty of fun in Parliament dismissing security concerns about his Government’s decision to award Chinese telco giant Huawei a $136 million rail communications contract.

He cracked gags about the Chinese People’s Liberation Army wanting to run espionage operations from Rockingham and pondered if Liberal MPs might really be Chinese spies because they used Huawei phones when in government.

But it looks like the State Opposition will have the last laugh because there is nothing funny about the criminal charges Huawei faces in the US.

“For over a decade, Huawei employed a strategy of lies and deceit to conduct and grow its business,” US acting attorney general Matthew Whitaker said last week.

He listed more than 20 allegations of fraud as part of Huawei’s “strategy of lies” that resulted in the arrest of its chief financial officer in Canada.

The media statement and a US Department of Justice indictment offer sobering reading for McGowan about the company being paid to install our 4G radio network for train drivers and controllers.

Even if the Premier put aside the heightened security fears about Huawei and the Chinese government, he cannot ignore the moral and ethical dilemma of doing business with a company accused of dirty deals with Iran.

“These charges lay bare Huawei’s blatant disregard for the laws of our country and standard global business practices,” Whitaker said. “Companies like Huawei pose a dual threat to both our economic and national security.”

Hard-nosed political advisers might argue such potent statements are more about the US pushing back against China’s technological and trade juggernauts.

But it is worth noting that McGowan sidestepped direct questions about the virtue of the Huawei deal when a reporter raised the criminal charges on Thursday.

Reporter: They’re accused of lying to the FBI, bank fraud, attempting to steal trade secrets — should they be getting WA taxpayer funds?

Premier: We’re seeking advice. When we get that advice we’ll be able to make further decisions.

Reporter: Are you ethically comfortable with taxpayer funds going to them?

Premier: It’s a contract. There was a tender process independent of Government. We asked ASIO if there was a problem here and they said there wasn’t.

There is now.

“We’re calling on the Government to abandon this contract,” Opposition deputy leader Liza Harvey said yesterday.

“It was a dodgy decision in the first place. It’s time to come clean on how much this deal has cost us.”

McGowan has often played down the significance of the communications contract by saying it just provides a system for train drivers to talk to one another.

“Somehow, the Liberal Party is trying to turn this into Watergate,” he quipped in August.

“There will somehow be all these spies sitting there in Beijing listening to the conversations between train drivers on the Joondalup line and headquarters.”

Perhaps the Government’s decision last week to review whether Huawei could still deliver on the contract — given its fight with the US — was the first step in walking away from the rail network deal.

What the Premier needs to avoid, however, is having to pay compensation to Huawei for dumping them from the contract. If it is not a good look to be in business with a Chinese company facing fraud and money laundering charges, how will it look to hand them a pile of cash for doing nothing?

The US, remember, has warned Huawei it will “not tolerate businesses that violate our laws, obstruct justice, or jeopardise national and economic wellbeing”.

McGowan also has to be careful not to offend Beijing given his Government’s deliberate moves to strengthen ties with the superpower for the purposes of trade and tourism.

The other companies that tendered for the communications contract, including Ericsson Australia and Optus, must be watching with interest.

Another issue that seems to be wearing down McGowan’s sense of humour is the great lobster quota quarantine quandary.

What seemed like a good idea before Christmas — to allow more crays to be caught and assign a pile of them for Government marketing purposes — went bad. The rock lobster industry pulled out of a deal and now both sides need a compromise.

“It’s not our number one issue,” McGowan said on Friday. “In the overall scheme of things we have much bigger things we deal with.”

But to quote Australia’s greatest song writer Paul Kelly, from little things, big things grow.