Canada-China relations turn icy over arrest of Chinese exec

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Relations between Canada and China turned frostier Tuesday as China detained a former Canadian diplomat in Beijing in apparent retaliation for the jailing of a top Chinese executive at the request of the United States.

Relations between the three countries were shaken by Canada’s arrest of Meng Wanzhou, chief financial officer of Chinese telecommunications giant Huawei and daughter of its founder. Canadian authorities detained Meng on Dec. 1 during a layover at the Vancouver airport. The U.S. accuses Huawei of violating American economic sanctions against Iran.

The Huawei case has threatened to complicate U.S.-China efforts to resolve a bitter trade dispute — though the two countries signaled Tuesday they are preparing to resume talks.

Heightening tension between China and Canada, Canadian Public Safety Minister Ralph Goodale confirmed that a former Canadian diplomat was detained Monday night. The detention came after China warned Canada of consequences for Meng’s arrest.

“We’re deeply concerned,” said Goodale, who did not identify the former diplomat. “A Canadian is obviously in difficulty in China. … We are sparing no effort to do everything we possibly can to look after his safety.”

Michael Kovrig, who previously worked as a diplomat in Beijing, Hong Kong and the United Nations, was taken into custody during one of his regular visits to Beijing, according to a person familiar with the matter. Kovrig is now based in Hong Kong as North East Asia adviser for the International Crisis Group.

Canada had been bracing for retaliation for Meng’ arrest. The Canadian province of British Columbia canceled a trade mission to China amid fears China could detain Canadians to put pressure on Ottawa over Meng’s detention.

Former Canadian Liberal leader Bob Rae said it’s clear why Kovrig was detained. “It’s called repression and retaliation,” Rae tweeted.

In Vancouver, meanwhile, Meng appeared in court for a third day Tuesday as she sought release on bail.

Earlier in the day, China vowed that Beijing would “spare no effort” to protect against “any bullying that infringes the legitimate rights and interests of Chinese citizens,” Foreign Minister Wang Yi said at a conference in Shanghai.

Wang didn’t mention Meng. But ministry spokesman Lu Kang said Wang was referring to cases of all Chinese abroad, including Meng’s.

Washington accuses Huawei of using a Hong Kong shell company to sell equipment to Iran in violation of U.S. sanctions. It says Meng and Huawei misled banks about the company’s business dealings in Iran.

Huawei, the biggest global supplier of network gear for phone and internet companies, is the target of U.S. security concerns. Washington has pressured other countries to limit use of its technology, warning they could be opening themselves up to surveillance and theft of information.

In a popular rallying cry in previous conflicts with the U.S., Japan, South Korea and other governments, Chinese nationalists called on consumers to support Chinese brands. But in an unusual development, an equally large number of internet users criticized such calls as reckless.

The U.S. and China have tried to keep Meng’s case separate from their wider trade dispute and suggested that talks to resolve their differences may resume.

The Chinese government said Tuesday that its economy czar has discussed plans with U.S. Treasury Secretary Steven Mnuchin and Trade Rep. Robert Lighthizer for talks aimed at settling the two countries’ differences. Lighthizer’s office confirmed that he had spoken by phone with Chinese Vice Premier Liu He.

The news that trade negotiations may resume lifted stock markets around the world.

The United States has slapped tariffs on $250 billion in Chinese imports in response to complaints Beijing steals American technology and forces U.S. companies to turn over trade secrets.

Tariffs on $200 billion of those imports were scheduled to rise from 10 percent to 25 percent on Jan. 1. But Trump agreed to postpone those by 90 days while the two sides negotiate.

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