A Canadian prosecutor has called on a Vancouver court to deny release to a Chinese executive in a case that upsets US-China relations and worries global financial markets.
Meng Wanzhou, chief financial officer of telecommunications giant Huawei and his founder's daughter, was arrested last Saturday at the request of the US during a stopover at Vancouver Airport on the same day that China's Presidents Donald Trump and Xi Jinping started trading 90-day truce was ready that would threaten to disrupt global trade.
The US claims that Huawei has used a Hong Kong company to sell equipment in Iran in violation of US sanctions. It is also said that Meng and Huawei seduced American banks about their business in Iran.
The surprise arrest already stolen by Beijing raises doubts as to whether the ceasefire will exist and whether the world's two largest economies can solve the complicated issues. "I think it will clearly have a negative impact on talks between the US and China "said Philip Levy, executive officer of the Chicago Council on Global Affairs and White House economist, President George W. Bush. "There is the demeaning way that this happened just before dinner, without Xi noticing this – very difficult to save that face and we will see (Chinese retaliatory measures) that will make relations bitter."
Canadian prosecutor John Gibb-Carsley said at a court hearing on Friday that an arrest warrant for Meng's arrest had been issued on 22 August in New York. He said that Meng had been arrested on his way from Hong Kong to Mexico, that he was aware of the investigation and had even shunned the United States for months. His adolescent son is attending school in Boston.
Gibb-Carsley claims Huawei was doing business in Iran via a Hong Kong company called Skycom. He said the US banks misled Meng, saying that Huawei and Skycom were separated, as "Skycom was Huawei." Meng has claimed that Huawei sold Skycom in 2009.
When Gibb-Carsley urged the court to dismiss the bail request, Gibb-Carsley said Huawei's leadership had tremendous resources and a strong incentive to rebel: in the United States, charges of fraud put her in prison for 30 years ,
Mengs lawyer David Martin argued that it was unfair to refuse her bail just because she "worked hard and has exceptional resources."
He told the court that her personal integrity and respect for her father, Huawei founder Ren Zhengfei, would prevent a court order from being violated. Meng, who owns two houses in Vancouver, was ready to wear an anklet and build the houses as collateral, he said.
On Friday, there was no decision by the judge on the bail, so Meng will spend the weekend in jail, the hearing will continue on Monday. Justice William Ehrcke said he was thinking about the planned detention conditions for the weekend.
Huawei is the world's largest provider of network equipment for telephone and Internet companies and has long been regarded as the espionage of Chinese military or security services
"What is lost in the initial frenzy here is that Huawei has been around for some time US Government regulators, "said Gregory Jaeger, Special Counsel at Stroock Law Office and former Attorney General. "This is the culmination of a likely lengthy investigation."
The arrest of Meng came after the armistice of Trump-Xi in Argentina to a shocking surprise. Exact details of the agreement are elusive. However, the White House said that Trump has suspended an import tax increase of $ 200 billion on Chinese goods for 90 days, which should come into effect on January 1. In return, according to the White House, the Chinese agreed to "buy a very large amount of agricultural, energy, industrial, and other products from the United States.
The delay should give the two countries time to find a solution There has been a trade conflict for months.
The US accuses China of using robbery tactics to overcome America's dominance in technology and global economic leadership. This allegedly includes forcing American and other foreign companies to hand over trade secrets in exchange for access to the Chinese market and for cyber theft.
Washington also regards Beijing's ambitious long-term development plan "Made in China 2025" as a program that dominates areas such as robotics and electric vehicles by unduly subsidizing Chinese companies and discriminating against foreign competitors.
The United States has imposed $ 250 billion in tariffs on Chinese goods to urge Beijing to change its course. Trump threatened to extend tariffs to almost everything China supplies to the United States. Beijing has burdened US exports with about 110 billion US dollars.
Fears that Huawei's case could spark renewed US-China hostility has rocked global financial markets. On Friday, the industrial average of Dow Jones fell by nearly 560 points.
But in a sign that the case would not disappoint the Trump Xi ceasefire, Beijing protested Meng's arrest, but said talks with the Trump government would take place. Chinese Ministry of Commerce spokesman Gao Feng said China is confident that a deal can be made during the 90-day break.
Despite this, Cornwall University economist Eswar Prasad warned that "this incident highlights the huge gap in trust between the two sides." The tough negotiations that lie ahead are unpleasant, and it's going to be more than a convivial dinner between the two sides Leaders of the two countries take time to bridge this gap. "