Malaysia Should Side With The West For Long Term Digital And National Security – Analysis

The 5G issue in Malaysia has predominantly been framed from a one sided narrative in support of the opening for a second network which will include the possible inclusion of Huawei. Commercial reasons and perceived communal benefits seem to be used as the ultimate pretext and justifications, at the expense of the country’s long term risk and vulnerability despite the pressing evidence and concerns raised by the West.

Various arguments have been put forth by many quarters, in arguing for the need to break the monopoly of Digital Nasional Berhad and to embrace the inclusion of a second network that might potentially be dominated by leading Chinese firms including Huawei or ZTE.

The EU and US have warned Malaysia over risks to national security and foreign investment as the government finalises a review of its 5G rollout that could allow China’s Huawei a role in the country’s telecoms infrastructure.
Envoys to Malaysia from the US and EU have written to the government, presenting warnings of risks involved. Huawei, the Chinese equipment maker blacklisted by Washington, has lobbied heavily for another chance at a role in building Malaysia’s network.

The US and the West have long warned of the risks and the negative chain implications of China’s digital overtures, from Huawei to TikTok. These are not being just created for geopolitical considerations and purposes, but based on real observations, evidence and conclusions from the comprehensive works done by the Intelligence Community (IC) of the US and other Western countries. There is a compelling reason for them to produce warnings to other countries at the receiving end of these Chinese digital overtures disguised as a friendly outreach to nations based on their more competitive and cheaper commercial terms.

Beijing is now forced more deeply into the corner with the reawakening of regional fears and concerns from hard power security to awareness on soft power influence and espionage vulnerabilities. Its BRI and RCEP agenda have also been constrained by a slowing internal economy and the new term under Xi is forced to scramble to halt the West’s growing immediate momentum in providing support and advice to regional players on the risks of being under the Chinese economic and digital orbit. The exodus of top high impact technological companies and the slowing economy have all forced Beijing to expand its depth of measures to strengthen the remaining openings still beneficial to them, and this includes the digital sphere in the region.

This also provides a critical complement for Beijing in providing it with the crucial platform that will provide the potentiality and openings for sensitive and critical information derivation, especially on a nation’s security and infrastructure data and information and the overall capacity that includes a combination of all relevant data assessment including military and non military hardware and software capacity.

Digital and national security risks remain real, despite efforts to portray these as efforts by the West to push back against China.

Dangers and Implications with Continuous Digital Bandwagon with China

By wanting to have a second network, potentially one that is dominated by Huawei, it will cost Malaysia three main negative implications.

Firstly, it might lose out on greater US and the West support systems and initiatives that will strengthen its economy and its defence capacity. The country blatantly disregards the real advice and risk warning on the vulnerability and the harm that this will do to its critical national infrastructure, security and sovereignty. It remains vulnerable to its national assets and digital and cyber networks and data being compromised, which will set off long term negative chain effects. This will deter the US and the West from further providing the needed defensive, technological and economic support which will also harm their assets and infrastructure should the country invite Chinese providers into its inventory.

The country might also face further limitations in economic and investment inflow as a result of our move, as foreign institutions, particularly Western firms, will remain wary of the risks posed by the institutionalized Chinese networks in its system. It will then lose out on the economic and investment front, as it risks losing its credibility and image as a responsible, normative and value-based and business friendly nation, by being fragile and too easily succumbing to Chinese influence and pressure. Malaysia will have to stand up to global norms and values, and stand with the rules-based and normative outline as a responsible emerging regional and global player, by standing firm on openness, trust, rules-abiding commitment and assurances of ethical and rightful adherence to investment and business ethics and rules.

By allowing Chinese firms that have been pointed out as not a player in keeping to the rules in shaping its 5G networks, the country sends a very ingrained negative message to the world and the West that it is very much pro China and China friendly in its policy approach and overtures, despite stating that it will be purely based on commercial considerations. Malaysia has the full rights to determine its options, and not just based on commercial impact alone. In making this move of considering Huawei and the setting up of a second network, the country already sends a clear message that it continues to be pro China.

Secondly, the country remains further entrenched in its Chinese orbit of dependence and will leave it the most vulnerable to Beijing’s potential economic and security blackmailing. Not only is the country already hapless in its defensive and deterrent capacity and approach, by succumbing to the Chinese pressure and economic tool of promises and assurances of investments, it will be compelled to accept the push for the 5G admission.

This would then expose it further into security risks and lapses, as concerns on espionage and potentiality of sabotage and being held ransom in the event of a real time conflict are real and dangerous. This will also mean that it is unable to get the support from the West as it will also render their systems to high risks, and the country will be trapped yet again with the worst outcome. Its rights in the South China Sea and its territorial integrity are all entangled in the common sphere of this overarching ties with China, particularly on its digital and critical security networks.

Thirdly, Beijing will get a fresh boost in its regional and SCS ambition, including having positive implications on its Taiwan agenda. Already a dominant presence in Malaysia from transport infrastructure to capital support to petrochemical and increasingly semiconductor and rare earths and others, the inclusion of 5G will only embolden and strengthen its grip on almost the entire chain of Malaysia’s security vulnerability.

This would be used to further weaken the country’s deterrence and defence capacity including in the South China Sea, as it will be dependent on Beijing’s goodwill in continuing these support and service in these assets, and would also make the country at the receiving end of future blackmail or getting the worst ultimatum in event of a real hot war or conflict. It might be forced to trade off its assets or to reduce its retaliatory or bargaining efforts and intensity, based on the potential blackmail or threat of the greater damage that can be done to the country’s infrastructure from the 5G and digital grip that Beijing will have.

Malaysia would also be used as a regional base in expanding its digital ambition, should the 5G presence be upheld, to send a direct message to regional players that it has the capacity to halt the West’s attempts of digital containment.

By providing a state backed support in terms of capital and competitiveness in terms of pricing, Huawei and other firms often enjoy the benefit of commercial advantage, which will definitely lure regional players to opt for the Chinese option, as with other overtures through state owned enterprises (SOE), being used as an effective tool in trapping regional players and somewhat forcing these nations to opt for these firms based on commercial values and higher returns, as opposed to the higher priced Western alternatives and the “baggage” that comes with it, including criteria on labour standards, human rights and others.

Malaysia will suffer in the end if it does not choose the path of aligning with the higher value based and rules based order, and on the grounds of long term security assurances. It will suffer from the delay and cost, and the West will suffer too, as it will need to recalibrate the existing and future strategies and ventures in Malaysia if it was to proceed with potential Huawei presence. Malaysia needs to provide a stabilizing and reassuring tone and message not only to other future firms and investment confidence, but to also send a good message to China that Malaysia will not be tempted or influenced by the pressure of the RM170billion investment as a tool in the country accepting the Huawei entry. The biggest gainer will be China, yet again in this whole debacle.

US National Security Council official for cyber security policy Amit Mital says “If Malaysia reopens this following a review, why would any investor or company in the future have trust and faith in the sanctity of commercial contracts in the Malaysian domain? It is important to all that processes be fair, open and transparent.”

It remains true. It will give a wrong signal and give a very unfair messaging to others that all future processes or agreements might be vulnerable to last minute changes or about turns, in the name of external pressure and influences. In this case, the country only weaken its investment and business standing by being seen as too vulnerable to Beijing’ dictate and not having a firm, resolute and principled stance in its own judgment and policymaking. It has to be based on transparency, openness and the wisdom to go for long term security stability and assurances rather than be blinded and lured by short term traps and overwhelming dependence in order to fix our economy. For this, the West remains Malaysia’s best bet for its future resilience and assurances.