Well well well.
Edward Snowden has revealed that the Canadian signals intelligence agency Communications Security Establishment Canada (CSEC), a Five Eyes partner of New Zealand’s signals intelligence agency GCSB, has been electronically spying on a communications network operated by the Brazilian mines and energy ministry. Brazil has a strategy of using its natural resources exploitation to become a major power, and the Ministry of Mining and Energy (MME) is the coordination node for that strategy. The network connected the ministry, state run oil and mine companies and private Brazilian energy firms, and was a forum where subjects such as investment strategies, negotiating positions and other sensitive commercial information were discussed. This included comunications with firms such as Petrobras, the Brazilian state-owned oil conglomerate.
Needless to say, the MME communications network, presumably internet and telephonic in nature, would be of value to competitors or others seeking to countervail Brazilian economic growth and power projection. With its own energy sector comprising a vital part of Canada’s economy (often in competition with Brazilian interests), it should not be entirely surprising that the Canadian government authorized this instance of economic espionage.
CSEC shared what it obtained with its Five Eyes partners. That particular revelation follows on the heels of Snowden disclosing that the NSA tapped into the personal as well as official communications of Brazilian President Dilma Rousseff, although it is unclear if these were also shared with the other Five Eyes partners.
The CESC angle is interesting because Brazil is no adversary of the Five Eyes nations (in fact, it has a history of alliance with the US) and because Petrobras is a direct competitor of US and Canadian energy firms in a number of markets, including some in the Asia-Pacific. Petrobras has also been involved in pushing for off-shore oil and gas exploration rights in New Zealand, which means that the New Zealand government is quite possibly privy, in advance and thanks to the Canadians, to the Brazilian’s internal logics and bottom lines with regards to those ventures.
If so, it is possible that the recently passed legislation to severely curtail sea demonstrations against oil and gas exploration in New Zealand waters was motivated not by a direct request from Petrobras and other energy sector actors, but by direct knowledge of its internal concerns about the cost impact of such demonstrations if left unchecked. If this speculation is correct, it would be a twist to the economic espionage tale because the National government used the information gleaned by Echelon to help rather than hinder the activities of a foreign based private firm facing strong domestic opposition.
Whatever the specifics, the Canadian-Brazilian spy saga confirms what Snowden has previously disclosed, which is that the Five Eyes network routinely engages in economic espionage on allies as well as adversaries. Brazil has protested the intrusions vigorously, most recently by calling in the Canadian ambassador in Brasilia to complain about the breach of trust and previously by means of President Rousseff’s scathing speech to the UN General Assembly where she denounced the practice of spying on friends and partners. The Brazilians denunciations are not just rhetoric–they are actively looking for ways to create alternative internet routing systems that can circumvent US dominance of fiber optic cable networks. They have been joined in this initiative by–no surprises here–the Chinese.
Given these revelations, the questions begs as to what the GCSB is doing when it comes to economic espionage on allies or partners as well as adversaries. Given the Canadian revelations and given that Canada is considered to be a junior partner in Echelon/Five Eyes just like New Zealand, by what means does the GCSB do so and does it share the information that it collects with its Five Eyes counterparts?
We must remember that it is already known that the GCSB has eavesdropped on Japanese diplomatic communications regarding whaling and on UN communications in the build up to both Gulf Wars. Although this is a more traditional form of signals intelligence gathering in that it targeted diplomatic intercepts, the communications being intercepted were from a country that New Zealand is friendly with and an organization that New Zealand has been a champion of (and in which it is lobbying for a seat on the Security Council).
The revelations are important because it suggests that economic espionage by the Five Eyes network is pervasive and equally shared amongst the partners.
If I were involved with a Chinese firm, to say nothing of Petrobras and any number of other foreign commercial entities (state or private), I would be concerned about doing business in and with New Zealand given what we now know (so far–there is more to come). Forget milk powder contamination and other production snafus: the real issue is not so much product quality or reliability but whether New Zealand can be trusted to not use its signals intelligence capabilities and network to engage in the type of economic espionage the Canadians and Americans are clearly doing (and one would assume the Australians and British are doing as well). That the GCSB can now do it locally as well as from afar (thanks to the recently passed GCSB Act amendments) should double the concern.
The same concerns might be raised by the eight countries involved in negotiating the Trans-Pacific Partnership (TPP) trade and investment agreement that are not Echelon members. Australia, Canada, New Zealand and the US are parties to the negotiations, which given the Snowden revelations raises questions as to what they might covertly know about the other countries’ negotiating positions and about how much of what they might know is shared exclusively amongst themselves in order to better coordinate their approaches to the negotiations.
It should also be remembered that the NSA used private telecommunications firms and other corporate entities to cast its signals trolling net overseas. Does the GCSB do the same?
Of course, other countries engage in economic espionage. The Chinese, Russians, French and Israelis are known for it. But none of these countries have had their means and targets exposed in public, nor do they have the reach of the Five Eyes network at their disposal.
It is a big difference. If the Chinese, Russians or many others, either directly via state agencies or through Â any number of non-state (including corporate) fronts, want to obtain signals intelligence abroad, they have to do so covertly. But the Five Eyes partners freely share their signals intelligence. In other words, non-Five Eyes signals intelligence agencies have to try and sneak through back doors to access the sensitive information of others, whereas the Echelon members freely pass surreptitiously gathered information through the front doors of their respective signals intelligence agencies.
Perhaps that is why the GCSB and TSIC Bills have been pushed so hard and so fast by the National government. The concern was not about terrorism, which served as a good fig leaf. The concern was not just defensive, in countering cyber and signals espionage on New Zealand targets and interests No, the concern was as much if not more offensive in nature in that the new powers of the GCSB facilitates exactly the type of spying that the CSEC was engaged in with regard to Brazil.
More precisely, before the passage of the Bills (I am assuming that the TSIC bill will pass) the GCSB could engage in economic espionage on friendly countries and firms but the legality of it doing so was in question when it came to it engaging in such spying (as well as more traditional types of signals intelligence) on New Zealand soil.Â Now it can do so legally. Any country or firm not part of the Five Eyes network that proposes to do business with or in New Zealand needs to take account of that.
The bottom line is that the Snowden revelations increasingly point to GCSB involvement in economic espionage of the first order. It may be only a matter of time before he drops a bombshell about the who, what and where of GCSB espionage. For a minuscule isolated nation heavily dependent on trade with foreign partners for its economic prosperity, this could be a potentially disastrous development.