Avoiding a knee-jerk response, China is delinking the detention of the daughter of the founder of Huawei in Canada from trade talks with the U.S.
On Friday, the Chinese Foreign Ministry reiterated Beijing’s call that Meng Wangzhou, who was detained on Saturday, on the behest of the U.S., by the Canadian authorities, during transit in Vancouver, be immediately released. Ms. Meng has been the Chief Financial Officer (CFO) of Chinese tech giant Huawei, as well as the daughter of the company’s founder Ren Zhengfei. Ms. Meng was arrested, apparently as part of a U.S. investigation of on the use of the global banking system by Huawei to evade U.S. sanctions against Iran.
The Asian Nikkei Review has reported that Huawei plays a key role in the ‘Made in China 2025’ industrial modernisation initiative, which U.S. Trade Representative Robert Lighthizer seeks to scrap as the two countries vie for technological superiority.
The news of Ms. Meng’s arrest on December 1 has spiralled an angry domestic reaction. Chinese and other markets also dived in response, amid fresh doubts about the prospects of the 90-day negotiations between the Chinese and U.S. authorities to work out a trade deal. The three-month timeline to defuse a trade war between the two countries was set following talks between U.S. President Donald Trump and his Chinese counterpart Xi Jinping on the sidelines of the G-20 summit in Argentina.
However, Chinese authorities are making a conscious effort not to intertwine the trade talks with Ms. Meng’s arrest. “As for the China-U.S. trade talks, I have been saying in the last two days that... the two sides are accelerating negotiations to reach a win-win deal as soon as possible,” Chinese Foreign Ministry spokesperson Geng Shuang emphasised during his briefing.
China’s Ministry of Commerce also said that China and the U.S. have been communicating and cooperating smoothly, and China was confident in striking a deal with the U.S. within the next 90 days.
Caught in the melee
But many analysts in China argue that Ms. Meng’s detention and the trade talks are connected. “Huawei has become another card for the U.S. to play against China in the ongoing trade war,” Global Times quoted Wang Yanhui, head of the Shanghai-based Mobile China Alliance, as saying.
