An investigative Report on the U.S. National Security suggests that Chinese Telecommunications companies, Huawei and ZTE, pose substantial cyber and espionage threats to the US.

The lack of cooperation with the investigation team, uncertainties with the companies’ ties to and relationship with the Chines government and the communist party, their corporate structures, decision making processes, transparency, and Huawei’s ties to the Chinese army, are among the main factors cited.  The ultimate recommendation is that Americans in general, and government bodies in particular were advised to cut all relations with Huawei and ZTE and not use their products.

Some countries, including Australia, have already decided to avoid any relations with these firms, and others may follow suit.

In Canada there are mixed signals.  The Ontario government helped Huawei increase its presence in Canada, but the Federal Government is advising that Huawei might not be welcome as a provider of government networks.  As the situation develops, it will be interesting to see how the Canadian government and law-makers deal with the situation.  

The Chinese Government is sure to react, further complicating the picture.