OTTAWA—Canada’s stunning arrest of a top executive of China’s telecom giant Huawei on a U.S. extradition request rippled through stock markets and around the world Thursday, with Prime Minister Justin Trudeau saying he had nothing to do with the decision by Canadian justice officials.
The arrest on Saturday of Meng Wanzhou, Huawei’s chief financial officer and daughter of the company’s founder, Ren Zhengfei, was made by “the appropriate authorities,” Trudeau said.
In Montreal, the prime minister told reporters he was given “a few days’ notice that this was in the works.” Trudeau was in Argentina last week at the G20 summit, after which U.S. President Donald Trump and Chinese President Xi Jinping met Saturday — the day of Meng’s arrest — and announced a temporary truce in a tariff war that has prompted fears of a global recession.
Stock markets that had plunged amid uncertainty over the supposed truce fell again at news of Meng’s arrest, before staging a comeback by the end of Thursday.
Trudeau insisted that no one at the political level in his government was involved in the decision to approve the Chinese business executive’s arrest, and that he had no “direct or indirect conversations with any of my international counterparts on this.” In French he confirmed he had not spoken to President Xi.
The RCMP executed a provisional warrant issued by Canada’s Justice Department at the request of the FBI, a Canadian police source said.
Ian McLeod, a Justice Department spokesperson, said the arrest took place Saturday afternoon at the Vancouver airport. The U.S. now has 60 days to provide Canada with its formal request for extradition and supporting documents. There are several other steps before a judge might allow an extradition request, which is ultimately up to the minister of justice to approve.
Now that Meng has requested a publication ban in the matter, McLeod said the Canadian government will not comment further, and will only reveal what position it will take on whether she should be released on bail at a court hearing, scheduled for Friday at 10 a.m.
American news outlets reported the U.S. wants Meng extradited as part of a U.S. investigation of an alleged scheme to use the global banking system to evade U.S. sanctions against Iran.
The Chinese government made its outrage clear Thursday in statements in Beijing and in Ottawa, demanding her immediate release.
The Chinese Embassy in Ottawa issued a statement noting Canada, at the request of the Americans, “arrested a Chinese citizen not violating any American or Canadian law.”
“The Chinese side firmly opposes and strongly protests over such kind of actions which seriously harmed the human rights of the victim. The Chinese side has lodged stern representations with the U.S. and Canadian side and urged them to immediately correct the wrongdoing and restore the personal freedom of Ms. Meng Wanzhou.
“We will closely follow the development of the issue and take all measures to resolutely protect the legitimate rights and interests of Chinese citizens.”
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The dramatic arrest appears to have unfolded “like a chapter in a John le Carré novel,” full of international intrigue and mystery, said trade expert Adam Taylor.
Taylor, head of Export Action Global, and a past aide to a former Conservative international trade minister, says he was “shocked” by the news.
“Huawei is such an integral part of the Chinese march into the western world,” that Canada’s role in nabbing one of its top executives at the request of the Americans could derail any hopes Canada had of broadening trade ties with China, he said. “It is hard to discount the effect it will now have.”
The story is also cloaked in secrecy, but the allegations are a major twist in ongoing tensions between China and the U.S. which are vying to flex their global economic and political might.
Nevertheless, in Beijing, a top official suggested the two countries might still resolve their tariff war.
The latest development is certain to factor into crucial decisions Canada must make about whether Huawei can be trusted to take up a role in providing equipment for the next generation of “5G” wireless networks around the world. Already the U.S., Australia and New Zealand have moved to ban Huawei from supplying gear for their networks.
Huawei has long sought to increase not just a share of the global smartphone market but to become a lead player in the next generation of wireless networks around the world, as countries move to adopt faster 5G technology. In Canada, the previous Conservative government took a go-slow approach to allowing Huawei into the telecommunications market. The current Liberal government is in the midst of what it calls a “comprehensive review” of what role Huawei’s technology should play.
In the Commons, the Conservatives demanded the Liberal government ban Huawei. MP Dan Albas called it a “Communist Chinese government-controlled company” that will spy on Canadians.
In Montreal, Trudeau was asked why Canada is not following three of its trusted English-language “Five Eyes” intelligence-sharing allies — on banning Huawei equipment.
Dodging a direct answer, he said, “The protection of citizens and of our institutions is of course of primary importance to this government and that’s why we work with our world class intelligence agencies and follow their recommendations.”
Canada’s top secret signals security agency, CSE, refused Thursday to say whether there had been any increase in cyber attacks by China on Canadian companies or infrastructure in the 24 hours since the Huawei executive’s arrest became public.
Scott Jones, director of the Canadian Centre for Cyber-Security, said only that there are constant daily attacks by any number of state and non-state actors, and that Canada must continuously be in defensive mode.
He said that it would be “premature” to reveal any conclusions about Huawei, and said the government’s assessment will take account of “Canada’s unique circumstances” such as the size of the country and an urban/rural split in deciding whether to allow Huawei’s to take part.
James Lewis, of the Washington-based Centre for Strategic and International Studies, told CBC the arrest is “part of a larger campaign to get countries to toe the line on Iran sanctions.”
“The arrest sends a message that if you don’t pay attention to sanctions on Iran it will not be business as usual.”
He added that Canada, as a trusted security partner of the U.S. that must share the same concern about security vulnerabilities, had little choice but to respond positively to the U.S. arrest request. “I think Canada did the right thing,” he said.
Tonda MacCharles is an Ottawa-based reporter covering federal politics. Follow her on Twitter: @tondamacc