The chief financial officer of the world’s largest manufacturer of telecommunications equipment was arrested in Canada at the apparent request of US prosecutors.
On Saturday night, Chinese president Xi Jinping and Donald Trump sat down in Buenos Aires for dinner as part of the G20 summit in Argentina. Despite the US president’s aggressive campaign language, the two have always seemed to have a cautiously cordial personal relationship, and the meeting ended in the agreement of a 90 day moratorium on new retaliatory tariffs between the two countries, signalling that an end might have been in sight for the burgeoning trade war between the US and China.
But it turns out that at the same time as the two leaders were tucking into their Argentinian steak, a high-ranking Chinese business leader, Meng Wanzhou, the chief financial officer of telecoms giant Huawei, was being arrested in Canada, apparently at the request of US authorities seeking her extradition. Chinese authorities have spoken out sharply against the arrest, calling it a human rights violation.
The reason for Meng’s arrest has not been released. In a statement released on Twitter, Huawei said that Meng faced “unspecified charges in the Eastern District of New York.” But the company, which is the world’s second-biggest manufacturer of smartphones (the largest is Samsung, with Apple in third place) and the world’s largest manufacturer of telecommunications equipment, has been under investigation for possible violations of Iran sanctions since April, according to the Wall Street Journal.
The problems US authorities have described with Huawei’s business practices are not necessarily overblown. In the UK, a government report signed off by GCHQ, the British spy agency, said that it could only offer “limited” assurances that the company’s hardware, which are key parts of critical telecommunications infrastructure used by BT and Vodafone, did not have critical vulnerabilities that could facilitate Chinese spying.
In the US, federal agencies have been barred from purchasing Huawei equipment since August 2018, and the governments of New Zealand and Australia have followed suit, saying that the company poses “significant security risks”.
The news of the arrest, which was not made public until Thursday morning, is likely to torpedo any chance of a thaw in relations between the world’s two largest economies, and stock markets dropped sharply in response to the news.
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Source:: New Statesman