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How arrest of Huawei Technologies CFO extends troubled history with US

07 December, 2018, 09:49 | Author: Sara Gill
  • Huawei CFO Wanzhou Meng arrested in Vancouver, faces extradition to U.S.

Meng was changing flights in Canada when she was detained "on behalf of the United States of America" to face unspecified charges in NY, according to a Huawei statement.

A month later, Washington and Beijing reached a deal that would strike ZTE from the sanctions list - just days after China reportedly offered to ramp up purchases of United States goods to reduce the trade imbalance with the US.

But China's government says that she hasn't broken any US or Canadian laws, and is demanding that Canada "immediately correct the mistake" and release her.

The detention of Ms Meng threatens to scuttle the temporary detente reached by US President Donald Trump and his Chinese counterpart Xi Jinping at the G20 talks in Argentina to halt new trade tariffs for 90 days as the two countries negotiate.

In an incident similar to Meng's case, ZTE's chief financial officer was stopped at Boston's Logan Airport during the US investigation of that company, according to sources familiar with the case.

After the CFO of China-based global tech giant Huawei Technologies was arrested in Vancouver this past week, the Chinese government is now demanding she be released. The Shenzhen-based company said it complies with all applicable laws and regulations where it operates "including applicable export control and sanction laws and regulations of the UN, US and European Union".

Meng Wanzhou's detention comes after American authorities reportedly launched an investigation into suspected Iran sanctions by Huawei, which was already under scrutiny by United States intelligence officials, who deemed the company a national security threat.

Huawei is not listed, but China's second-largest telecom equipment maker, ZTE Corp, sank almost 6 percent in Hong Kong while most of the nearby national bourses lost at least 2 percent.

"You can play hardball with a small country but you can't do it with the USA", he said.

Last month, New Zealand blocked a mobile phone company from using Huawei equipment, saying it posed a "significant network security risk". Chinese technology has been a particular bugbear for the US president, who has justified imposing tariffs on Chinese imports with allegations of intellectual property theft by Chinese companies.

"At the request of the USA side, the Canadian side arrested a Chinese citizen not violating any American or Canadian law", the Chinese Embassy in Canada said on Thursday.


Can Meng fight extradition to the United States?

A Chinese foreign ministry spokesperson has demanded the US and Canada justify the arrest, and referred to Wanzhou's detention as a human rights violation, a charge often leveled at Beijing.

Reuters reported that the us has been investigating the tech giant for using the global banking system in an effort to evade Washington's sanctions targeting Iran.

Likewise, Rod Hunter, an worldwide economic official in President George W. Bush's White House and a partner at law firm Baker McKenzie, said, "I'm skeptical that the Chinese are going to want to say 'uncle.' " USA and Chinese officials are "trying to tackle a problem that is going to take years, maybe a decade, to resolve".

"One thing that is undoubtedly true and proven is the USA is trying to do whatever it can to contain Huawei's expansion in the world simply because the company is the point man for China's competitive technology companies", the editorial said.

As news of the arrest surfaced, lawmakers in Washington denounced Huawei for alleged links to China's communist leadership.

"China firmly opposes all forms of cyber attack and cracks down on them in accordance with law", he furthered. The report did not say what Huawei might be suspected of.

But suspicions persist. Concern now centres on the deployment of fifth-generation (5G) mobile networks, where Huawei is at the cutting edge.

But hours later, Huawei released a statement on its official Weibo account, not only confirming the arrest but revealing more information.

Meng's arrest comes as Ottawa and Beijing have been engaged in exploratory talks on a free trade agreement for the past two years, which would be the first deal of its kind between China and a western country.

"The protection of our citizens and our institutions is of course of primary importance to this government", Trudeau said to reporters during a press conference in Montreal Thursday, adding that Canada will continue to take advice from its security agencies. The US later replaced the ban with a fine and governance changes.

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