A recent report on the presence of technology companies from the People’s Republic of China (PRC) in Colombia has set off alarms about the risks involved with the Asian country’s investments in the sector. According to the Colombian political risk consultancy Colombia Risk Analysis, behind these investments are strategic interests with geopolitical consequences that the Colombian government has not considered.
The report, The footprint of Chinese Technology in Colombia, highlights how China’s security law compels all companies to cooperate and share information with state intelligence, including those with access to sensitive information — a state policy over which countries receiving Chinese technology have no control whatsoever, in that their investments represent a threat to digital independence and sovereignty, the report says.
This is a serious and latent risk for which Colombia is not prepared. “The big factor here is that Colombia does not consider the telecommunications sector as a strategic sector, so there is no debate about the vulnerabilities in cybersecurity behind Chinese technology,” Sergio Guzmán, director of Risk Analysis, told Diálogo.
This situation is of great concern, especially given the growing participation of Chinese companies in Colombia. “Unless Colombia establishes clear standards and specifications for investments in the technology sector, it could be opening the door to the dependence and undue influence of Chinese companies,” Guzmán added.
A warning that comes at a time when Colombia is making crucial decisions regarding technological investment, such as the recent tender for the development of 5G.
“We are talking about decisions with significant political implications, so it’s important that beyond the price and quality offered by Chinese companies, Colombia understands the risks associated with these investments and thus avoids making wrong decisions that are difficult to reverse,” Guzmán said.
5G: Chinese companies under scrutiny
On December 20, 2023, Colombia announced the results of the 5G spectrum auction. Although all eyes were on large telecommunications operators that won the bands, among them Claro, Womb, the Tigo-Movistar network sharing, and Telecall, other technology companies that will provide the infrastructure for this new network were also closely watched during the outcome of this process.
Under the limelight are Chinese suppliers who are already actively participating in the Colombian market. According to sources consulted by Risk Analysis, 50 percent of the 3G and 4G networks of Claro and Movistar and 100 percent of Tigo and WOM are provided by Huawei, a Chinese company that has been excluded from local infrastructure markets in multiple countries for being a threat to national security associated with fear of spying.
“This company’s [Huawei] ties to the Chinese government, as well as accusations of corruption, cost overruns, and unjustified delays in works contracted with Chinese companies, have led several countries to adopt restrictive measures, even prohibiting or excluding Huawei within their markets,” Carlos Augusto Chacón, director of Bogotá’s Hernán Echavarría Olózaga Political Science Institute (IPC) and author of the report, China’s 5G technology and the risks for Colombia, told Diálogo.
The Ministry of Information Technologies and Communications (MINTIC) in Colombia, however, is governed by the principle of technological neutrality and does not discriminate technology according to country of origin, which is why experts foresee a greater participation of Chinese companies in the development of this new technology. “Companies such as Huawei and ZTE will seek to expand their participation in the market without any type of restriction or control,” Guzmán says.
A complex scenario that worries experts and analysts to a great extent because of vulnerabilities behind this technology. “The biggest risk is that in Colombia there is no legal way to know the real participation of suppliers, so if tomorrow Colombia decides that Chinese companies are a risk to national security, the country will not really know how compromised its networks are, and it will probably be too late,” Guzmán added.
The principle of technological neutrality for the development of 5G network in Colombia comes at a time when several governments have warned about the threats posed by China’s cyberattacks, cyber espionage, and information dominance through the use of this technology.
Countries such as the United Kingdom, Australia, Canada, Japan, and the United States have banned Huawei from providing hardware for next-generation mobile networks, for being a cybersecurity risk, CNBC reported.
This was confirmed by U.S. Army General Laura J. Richardson, commander of U.S. Southern Command, during the South American Defense Conference (SOUTHDEC) held in Cartagena de Indias, Colombia, in late August 2023.
“[This technology] creates a backdoor that can affect your networks, can affect security, sovereignty,” Gen. Richardson said, as she invited countries to talk about these risks and prevent other nations from falling into their networks. “We have to talk about the dangers of this 5G technology, we are talking about the fact that the People’s Republic of China is communist, does not respect the human rights of its own citizens, and does not respect the rule of law,” Colombian media Caracol Radio reported.
This concern was also expressed in Brussels in late June 2023 when Thiery Breton, European commissioner for Internal Market, said that Chinese companies such as Huawei and ZTE constitute a risk to the security of the European Union. “As of today, the European Union Commission will not procure connectivity services that rely on Huawei or ZTE equipment,” Breton said via X.
In Latin America, the last country to speak out against this technology has been Costa Rica. Paula Bogantes, minister of Science, Innovation, Technology, and Telecommunications, said before Costa Rican lawmakers that China represents a risk for cybersecurity. Likewise, Vice Minister of Telecommunications Hubert Vargas described the political system of the Asian nation as totalitarian, restricting the fight against computer espionage, several local news media reported.
In August 2023, the Costa Rica government decreed that only countries endorsing the Budapest Convention, an international cybercrime treaty, could bid for 5G contracts. China — among other countries such as Russia — is not a signatory to this convention, so companies such as Huawei will not be able to participate in 5G equipment and software contracts in Costa Rica.
According to the Global Cybersecurity Index, Latin America is the region most vulnerable to cyberattacks. During the last few years, several governments and companies of the region have been victims of attacks, including Colombia.
But neither the attacks suffered by the country, the global cybersecurity warnings, nor the steps some countries have taken to protect their networks, seem to have raised much national concern in the coffee-growing country about the risks associated with Chinese companies in cybersecurity.
“In Colombia there is no restriction on Chinese companies, nor has the need to advance in the development of norms and regulations to guarantee the conditions of security and protection of data information been addressed at the political level,” Guzmán said.
“It’s not a matter of excluding competitors because they are companies of specific origin, but until the PRC modifies its legislation and guarantees the total independence of private companies, Colombia should exclude the participation of Chinese technology companies given that there is a potential for instrumentalization of these services in situations of geopolitical conflicts,” Chacón added.
This risk is of special concern due to the high presence of Chinese technology in the country. “Our warning applies to all sectors because Colombia is consuming Chinese technology in mobility, automobiles, electrical charging, and even in security devices,” said Guzmán
According to the Risk Analysis research, most security companies in Colombia buy their surveillance equipment such as cameras, motion sensors, telecommunications equipment, and video surveillance technology from Chinese companies.
Sources consulted by the political risk consulting firm said that business fairs are periodically held in China to which Colombian security entrepreneurs are invited, with all expenses paid by Chinese suppliers of surveillance and security equipment. “A clear example of the soft power practices that China has been using in the region,” Chacón said.
The Colombian government recently signed several agreements to strengthen the digital economy with China. The Ministry of Information and Communications Technologies highlighted the usefulness of Chinese technology for the well-being of Colombians and signed three agreements to strengthen the digital economy, create an internship program in technology companies in China for Colombian students, and establish an agreement between RTVC (Colombia’s public television and media system) and China Media Group.
National security, loss of sovereignty, and foreign investment
The risks associated with engaging Chinese technology companies for national security also go for foreign investment, experts say. “The development of infrastructure such as the 5G network with Chinese companies means that Colombia lacks guarantees for the security of companies that want to invest in the country, so Colombia would cease to be an attractive country for foreign investment,” Chacón said.
Risks that extend to the danger of dependence and loss of sovereignty with the technology sector. “The voracious consumption of Chinese technology and the anchoring to one or several Chinese suppliers has the potential to generate a relationship of dependence where the seller sets the conditions and not the buyer who is the sovereign state,” Guzmán said.
A situation that, experts say, is of particular concern because Colombia does not know how China’s business sector operates.
“Doing business with China is increasingly more opaque, more difficult. China is becoming a more obscure, more confusing trading partner, and that has implications for decision making, serious political and strategic implications, an incipient debate in our country,” Guzmán concluded.