Spy chief wanted ban on China telecoms from Australian 5G

Australia's critical infrastructure including electricity grids, water supplies and hospitals could not have been adequately safeguarded if Chinese-owned telecommunications giants Huawei and ZTE Corp. were allowed to help roll out the nation's 5G network, a spy chief said.

Mike Burgess, director-general of the Australian Signals Directorate, said his cyber experts had backed the government's decision in August to bar the two Chinese companies that he described as "high-risk vendors." It was the first time the secretive agency had disclosed such information.

"My advice was to exclude high-risk vendors from the entirety of evolving 5G networks," Burgess said in a recent speech released by his office on Tuesday.

Security agencies had previously protected sensitive information and core functions of Australian telecommunications networks by restricting risky vendors to the edges, Burgess said.

"But the distinction between 'core' and 'edge' collapses in 5G networks. That means that a potential threat anywhere in the network will be a threat to the whole network," Burgess said.

The next generation of telecommunications networks will be at the top of every country's list of critical national infrastructure, he said.

"5G technology will underpin the communications that Australians rely on every day, from our health systems and the potential applications of remote surgery, to self-driving cars and through to the operation of our power and water supply," Burgess said. "The stakes could not be higher."

Huawei was banned from bidding for contracts for Australia's broadband network in 2011. ZTE is a Chinese maker of mobile devices.

The Chinese foreign ministry accused Australia of ideological bias against the Chinese companies.

"Cooperation between Chinese and Australian companies is mutually beneficial in nature. Australia should offer convenience for the companies' cooperation between two sides, rather than making various excuses to deliberately obstruct the cooperation, such as taking discriminatory measures," ministry spokesman Lu Kang said.

"We urge the Australian side to cast away ideological bias and provide a level playing field for Chinese companies' operations in Australia. We hope Australia will take it seriously," he added.

Burgess' warning came as an Australian security think-tank raised concerns on Tuesday about increasing collaboration between Australian universities and China's People's Liberation Army scientists on research programs such as hypersonic missiles and navigation technology.

Australian Strategic Policy Institute researcher Alex Joske said some Chinese scientists hide their military backgrounds by claiming to be visiting scholars from non-existent institutions.

Since 2007, the PLA has sponsored more than 2,500 military scientist and engineers to study overseas, Joske said in a report.

Based on peer-reviewed publications co-authored by PLA and non-Chinese scientists, the United States, Britain, Canada, Australia and Germany were the top five countries engaged in research collaboration with the Chinese military since last year, the report said.

The report recommended that universities collaborate with allied countries rather than non-allied militaries on strategic research.

"It's not in our interests to help a non-allied military develop advanced military technology," Joske said. "We need better visa screening to make sure that people who've lied on their visa applications or are seeking to come to Australia to develop better military technology for China aren't let into the country."

Education Minister Dan Tehan said Universities were self-governing institutions best able to make decisions about collaboration while also satisfying all relevant Australian laws and security requirements.

Australian universities carefully assess applications from students from all countries and liaise with defense and security agencies as needed, the advocacy group Universities Australia said in a statement.

"Australian universities help to advance Australia's national interests through their research and education ties with students and researchers all around the world," the statement said.

The Defense Trade Controls Act gives the government and Defense Department oversight over providing information on any technology or research with potential military applications. That legislation is under review, and Joske said it should be expanded to prevent Chinese military scientists from learning about sensitive technologies while in Australia.

Several governments have scrutinized Huawei's links to the Chinese government. The private Chinese company was founded by a former People's Liberation Army major in 1987. Now the world's biggest telecoms equipment supplier, it suffered a setback in 2012 when a U.S. congressional report said it was a security risk and warned phone companies not to buy its equipment.

Shenzhen-based Huawei has said it would never give Australian customer data to Chinese spy agencies. But the Australian government said no combination of security controls sufficiently mitigated the risk.

5G networks will start commercial services in Australia next year.

The Australian Signals Directory, formerly the Defense Signals Bureau, became an independent statutory body with a more public profile on July 1. It is responsible for foreign signals intelligence, support to military operations, cyber warfare and information security.