Arrest of China executive boosts trade war fears
As President Donald Trump was arranging a trade truce with President Xi Jinping of China in Buenos Aires, Argentina, over dinner Saturday night, his administration was coordinating the arrest of a top Chinese technology executive who was flying through Canada.
White House officials, including John Bolton, the national security adviser who attended the dinner with Trump and Xi, knew of the impending arrest. So did a leading Senate Republican and Democrat. But it is unclear whether Trump knew of the arrest. And Xi was apparently never told at the dinner.
The detention is a boon to administration officials trying to limit the global spread of Chinese technology, especially equipment that poses security risks, and to enforce sanctions with Iran. But the move threatens to upend sensitive talks to resolve a trade war between the world’s two largest economies.
Global markets fell Thursday amid intensified concerns about an emerging
cold war between the United States and China, a sign that the 90-day trade truce announced by Trump and Xi would not quickly produce an end to the trade war.
The arrest of Meng Wanzhou, chief financial officer of Huawei and daughter of its billionaire founder, was the culmination of a monthslong investigation by a Brooklyn office of the Justice Department into whether the flagship Chinese company had violated Iran sanctions, U.S. officials said. She was detained Saturday while in transit in Vancouver, B.C., at the request of the United States, which now wants her extradited.
Bolton told NPR in an interview Thursday that he knew in advance that Meng’s arrest was coming. He said such notifications from the Justice Department “happen with some frequency,” and “we certainly don’t inform the president on every one of them.”
The Justice Department
typically briefs the White House in advance of actions in cases that are going to garner national attention or impact the public interest. Before Meng was arrested, Justice Department officials notified the White House office of legal counsel, according to an administration official.
The department also notified the chairman of the Senate Intelligence Committee, Richard Burr, R-N.C., and its ranking Democrat, Mark Warner of Virginia, according to a committee staff member.
Xi was apparently never told of the intent to arrest Meng at the dinner with Trump, where Bolton was present. The arrest came as a surprise to the Chinese government, which is calling for her immediate release.
While Meng’s arrest is a warning to other nations about the administration’s intolerance of economic sanction violations and its security concerns about doing business with Chinese technology companies, it further complicates efforts to resolve the United States’ trade war with China.
Trump has prioritized curbing China’s rise as a technological powerhouse and enforcing economic sanctions on Iran. At the same time, he has increasingly linked trade matters with national security – imposing new restrictions on Chinese investment in the United States and hitting China with tariffs on $250 billion worth of Chinese goods, including many products that the administration views as critical to U.S. national security, like nuclear reactor parts and semiconductors.
The Justice Department has not revealed exactly what Huawei was doing to run afoul of the sanctions. Chinese companies regularly do business in Iran, and much of that trade complies with sanctions regulations. The question over Huawei appears to be whether it violated sanctions by selling technology from the United States to Iran or in some other manner.
An investor reacts near boards displaying stock market prices in Beijing, China, on Thursday. Asian stock prices skidded Thursday after the arrest of a senior official at Chinese telecom equipment maker Huawei that could derail progress in China-U.S. trade talks.