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Security concerns have Australia reportedly reconsidering a 5G contract with China’s Huawei

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National security concerns may prevent Chinese firm Huawei from providing equipment to Australia’s new 5G networks, the Australian Financial Review reported Thursday.

Numerous security sources told the AFR that Huawei is almost guaranteed to be excluded from contributing to the country’s 5G wireless network after national security agencies recommended against involving Huawei. One source said the advice will be be “very direct” and provide “very little wiggle room.”

In 2012, Huawei was not allowed to tender for Australia’s National Broadband Network (NBN) due to cybersecurity concerns, a decision that was based on advice from the national security agency, the Australian Security Intelligence Organisation (ASIO).

And earlier this year, during a visit to the US, Australian Prime Minister Malcolm Turnbull was reportedly briefed by the head of the National Security Agency and Department of Homeland Security regarding concerns over Huawei supplying equipment for the 5G network. It was subsequently announced the Australia’s Home Affairs Department would conduct a full national security assessment before Huawei could contribute.

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Six intelligence chiefs – including the heads of the CIA, FBI, and NSA – testified in February that they do not use, and would not recommend private citizens use products from Huawei or Chinese company ZTE.

“We’re deeply concerned about the risks of allowing any company or entity that is beholden to foreign governments that don’t share our values to gain positions of power inside our telecommunications networks,” FBI Director Chris Wray said. “It provides the capacity to maliciously modify or steal information. And it provides the capacity to conduct undetected espionage.”

Since then, Australia’s defence department told Business Insider it no longer uses Huawei phones and is phasing out ZTE handsets. And the Pentagon announced in early May that it stopped selling Huawei and ZTE phones and modems in stores on its military bases because they “may pose an unacceptable risk.”

The other bidders for Australia’s 5G contracts are Finland’s Nokia and China’s ZTE.

Business Insider has contacted Huawei for comment and will update this post when it receives a response.

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