People hold a sign at a B.C. courthouse prior to the bail hearing for Meng Wanzhou, Huawei’s chief financial officer on Monday, December 10, 2018. THE CANADIAN PRESS/Jonathan Hayward

Canada-China relations turn icy over arrest of Chinese exec

The Huawei case has threatened to complicate U.S.-China efforts to resolve a bitter trade dispute.

Relations between Canada and China turned frostier Tuesday amid reports that the Chinese detained a former Canadian diplomat and as a Vancouver court resumed a hearing on whether to grant bail to a jailed top Chinese executive.

But U.S.-China tensions seemed to ease somewhat as the world’s two biggest economies confirmed they were working on talks to resolve a trade dispute that has shaken financial markets and threatens to slow global economic growth.

Relations between the three countries were shaken by the Dec. 1 arrest of Meng Wanzhou, chief financial officer of Chinese telecommunications giant Huawei and daughter of its founder. Canadian authorities detained Meng during a layover at the Vancouver airport at the request of the United States. 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.

But 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.

Just as the prospects for U.S.-China trade peace brightened, Canada’s relations with Beijing took a darker turn.

Reports surfaced Tuesday that former Canadian diplomat Michael Kovrig, now North East Asia senior adviser for the International Crisis Group, had been detained in China. The Brussels-based nongovernmental organization said in a statement that it is doing everything possible to obtain information about Kovrig’s whereabouts and to secure “his prompt and safe release.”

Kovrig previously worked as a Canadian diplomat in Beijing and Hong Kong and at the United Nations in New York. Canada’s Global Affairs department didn’t immediately respond with comment.

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

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

China vowed Tuesday 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.

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.

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.

The U.S. and China have tried to keep Meng’s case separate from their wider trade dispute, but jitters among companies and investors have roiled global stock markets.

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 per cent to 25 per cent on Jan. 1. But Trump agreed to postpone those by 90 days while the two sides negotiate.

AP Business Writer Joe McDonald, AP researcher Yu Bing and APTN video producers Fu Ting and Olivia Zhang in Beijing contributed to this report.

Jim Morris, Rob Gillies And Paul Wiseman, The Associated Press

Like us on Facebook and follow us on Twitter.

Just Posted

Sumas Way single-vehicle crash leads to quick arrest

Police were on the scene just seconds after a car was involved in a single-car crash in Abbotsford

When should the Ottawa Senators leave UBC for Abbotsford Centre?

Sens have exhibition game in Abbotsford tonight, but will risk Highway 1 traffic this afternoon

Abbotsford police chief speaking to Liberal candidate after second ad appears featuring photo of officer

Jati Sidhu had said an ad with the same photo posted last Friday was ‘not appropriate’

Stolen iPhone leads Abbotsford Police to 260 marijuana plants

Search warrant at west Abbotsford home leads to seizure of plants

Who is running for MP in Abbotsford?

Major parties have lined up candidates to run for Parliament

VIDEO: “How dare you?” Greta Thunberg addresses UN climate summit

‘We are in the beginning of a mass extinction and yet all you can talk about is money.’

Pettersson has 4 points as Canucks dump Ottawa 6-4

Vancouver wins NHL pre-season tilt in Abbotsford

British man returns to Yukon to tipple his own toe in long-running tradition

So-called sourtoe cocktail is a shot of whisky with a mummified human toe in it

Poll suggests Canadians concerned about fake news, but struggle to spot it

56 per cent of respondents admitted to reading or sharing inaccurate news

Province announces $3.5 million in funding for community solutions to overdose crisis

Grants up to $50,000 will be available for municipalities working with a regional health authority

Conservatives’ plan to ease mortgage stress-test rules may raise debt and prices

Andrew Scheer vows to loosen rules around stress test and remove it altogether for mortgage renewals

B.C. mom urges patience after rude comments while out with toddlers

People asked to be better and to help each other

U.S. wrestler says viral speeding ticket video was staged

WWE wrestler Lacey Evans says she does not condone disrespecting law enforcement officers

‘Own a piece of history’: Beachcombers location Molly’s Reach up for sale

‘This is one of B.C.’s most photographed buildings’

Most Read