Why Huawei arrest deepens conflict between USA and China

Why Huawei arrest deepens conflict between USA and China

Why Huawei arrest deepens conflict between USA and China

President Donald Trump did not know about plans to arrest a top executive at Chinese telecoms giant Huawei in Canada, two U.S. officials said on Thursday (Dec 6), in an apparent attempt to stop the incident from impeding crucial trade talks with Beijing.

On December 5, Canadian authorities confirmed that Meng Wanzhou, chief financial officer and deputy chair of Chinese telecoms giant Huawei as well as a daughter of Huawei's founder, was arrested in Vancouver, British Columbia on December 1 at the request of USA law enforcement authorities.

The United States has been looking since at least 2016 into whether Huawei violated U.S. sanctions against Iran, Reuters reported in April.

"The Chinese side has lodged stern representations with the USA and Canadian side, and urged them to immediately correct the wrongdoing and restore the personal freedom of Ms. Meng Wanzhou", the Chinese embassy's statement continued.

"The company has been provided very little information regarding the charges and is not aware of any wrongdoing by Ms. Meng", the statement said.

Global markets have plummeted - and Australian shares are expected to follow - after a fresh twist in the US-China trade war.

Analysts and traders had hoped that talks between US President Donald Trump and Chinese premier Xi Jinping would cool the trade war between the world's biggest economies.

Who has taken action against telecom giant Huawei and why hasn't Canada? .

Canada has arrested the chief financial officer of China's Huawei Technologies who is facing extradition to the United States on suspicion she violated USA trade sanctions against Iran.

The details of the charges against her remain unknown after she sought a publication ban, which was granted by the Canadian judge.

What could be behind it? A spokesman for the US Attorney's office in Brooklyn, which Reuters has reported is investigating Huawei, declined to comment.

The arrest was made at Washington's request as part of a United States investigation of an alleged scheme to use the global banking system to evade U.S. sanctions against Iran, according to people familiar with the probe.

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However, the company has been plagued with problems in the USA where lawmakers and intelligence officials have labeled the Chinese firm a threat to national security because of its close connections with Beijing, arguing that the company's technology could be used to spy on Americans. "China tension around geopolitics and techno-nationalism", he said of Meng's arrest. But American officials also worry more broadly about Chinese plans for state-led industry development they worry might erode USA industrial leadership.

"I do think.the timing has a bearing on those talks in particular because Huawei is perhaps the most successful global company in China", said Mr Campling.

Meng, who also has used the English names Cathy and Sabrina, served on the board of Skycom between February 2008 and April 2009, according to Skycom records filed with Hong Kong's Companies Registry.

Huawei has said it complies with all applicable export control and sanctions laws and other regulations.

Huawei is one of the largest tech companies in the world, but it has been under pressure in nations like the U.S., U.K., and Australia for allegedly doing the bidding of the Chinese government.

In June 2014, Chinese businessman Su Bin was picked up on a US warrant in Canada, where he had been attempting to establish residency.

Canadian Prime Minister Justin Trudeau has defended the decision by Canadian authorities to execute a U.S. extradition request and detain a Huawei executive.

"The Chinese side has lodged stern representations with the U.S. and Canadian side, and urged them to immediately correct the wrongdoing and restore the personal freedom of Ms Meng Wanzhou".

Why is Huawei a concern to the West?

Huawei is one of the world's largest telecoms companies, and is the world's second-largest smartphone manufacturer behind Samsung. Huawei has said neither it nor Skycom ultimately provided the HP equipment. But Australia and New Zealand recently banned Huawei from building 5G networks, and there are indications that other countries including Germany are revisiting the issue.

Wasn't another Chinese company also accused of Iran sanctions violations? But the company said early this year it had become the 25th largest research and development funder in Canada, thanks to partnerships with local universities. The US later replaced the ban with a fine and governance changes.

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