China Tries to Balance Huawei Arrest with Warmer Trade Ties


BEIJING — China’s management is making an attempt to strike a fragile steadiness between outrage and necessity, because it tries to preserve a current thaw with the United States whereas lashing out on the arrest of 1 a high Chinese tech government.

That balancing act was on show in Beijing on Sunday, because the Chinese authorities stated it had summoned the American ambassador to China, Terry Branstad, to protest the arrest of Meng Wanzhou, the chief monetary officer of the Chinese electronics big Huawei and the elder daughter of its founder.

Earlier within the day, People’s Daily, the Communist Party’s official newspaper, warned of “serious consequences” in opposition to the Canadian authorities who arrested Ms. Meng on an American warrant. She was detained in Canada greater than per week in the past on suspicion of fraud involving violations of United States sanctions in Iran.

The editorial warned that “only by correcting its mistake, immediately ending its violation of a Chinese citizen’s lawful and legitimate rights and giving the Chinese people a due explanation, can Canada avoid paying a heavy price.”

But at a high-level convention on Sunday at Tsinghua University in Beijing that included 4 Nobel laureates in economics from the United States, a senior adviser to the Chinese management opened his remarks by praising the 2 international locations’ broader financial relationship and avoiding any point out of the arrest.

“The economies of China and the United States are integrated,” stated the adviser, Ma Jianting, a vice chairman of the Development Research Council, the coverage advisory unit of China’s cupboard. “There is no parting of the ways.”

Mr. Ma’s remarks had been the newest of many indicators that the Chinese authorities was making an attempt to compartmentalize the Huawei problem, whereas nonetheless taking an assertive sufficient stance to fulfill nationalistic anger in China.

Beijing has taken a sequence of steps to enhance trans-Pacific relations since President Trump and President Xi Jinping called a truce in their trade war at the end of the Group of 20 summit meeting in Buenos Aires; Ms. Meng was detained on the same day as that dinner.

On Thursday, hours after word of Ms. Meng’s arrest in Canada spread publicly in China, a Commerce Ministry spokesman, Gao Feng, said that Beijing was “full of confidence in reaching a deal in the 90 days.” He also confirmed for the first time a White House assertion that China would be buying American food, energy and cars following the trade truce, but declined to provide any details.

Mr. Trump agreed in Buenos Aires to defer plans to raise tariffs on $200 billion a year in Chinese goods on Jan. 1. China’s leaders are also preparing to observe this month the 40th anniversary of the country’s post-Mao economic overhaul by calling for a series of moves to open up the economy to more trade and foreign investment, people familiar with Chinese economic policymaking said.

The anniversary, heavily promoted in official propaganda and the subject of Sunday’s conference at Tsinghua University, offers Mr. Xi a chance to take market-opening measures sought by the United States without seeming to give in to American pressure.

The final list of moves is still the subject of considerable discussion within the Chinese bureaucracy. But some options under serious consideration include further reducing tariffs on imports from all over the world and encouraging broader foreign investment in the slowing Chinese economy.

China made some moves in these directions this year, however, and it is unclear how much further the Beijing leadership is willing to go. China has already reduced the tariffs it charges from all over the world, for example.

By Beijing’s calculation, China’s average tariffs have fallen to 7.5 percent from 9.8 percent at the start of this year. By comparison, average tariffs in the United States are 3.5 percent, while the European Union’s are 5 percent.

Ms. Meng’s detention has considerably complicated China’s economic relations with the United States. It has ignited anger and astonishment in China, where Huawei, one of the country’s largest and most internationally successful private companies, is a source of national pride.

On Saturday, China’s vice foreign minister, Le Yucheng, summoned the Canadian ambassador to Beijing, John McCallum, to register his protest, according to Xinhua, the state-run news agency. The Canadian Embassy did not respond on Sunday to a request for comment.

One reason for the outrage is that very few people in China are aware that their government has quietly been blocking some Americans from leaving the country without filing charges against them or accusing them of wrongdoing.

The State Department issued a travel advisory last January cautioning that “individuals not involved in legal proceedings or suspected of wrongdoing have also” been subjected to “lengthy exit bans in order to compel their family members or colleagues to cooperate with Chinese courts or investigators.”

Secretary of State Mike Pompeo criticized the bans during a visit to China in October. Last month, he raised with a top Chinese foreign policy official, Yang Jiechi, his concern about an exit ban imposed on two young Americans who visited China last June and were not allowed to leave.

At a bail hearing on Friday in Vancouver, British Columbia, where Ms. Meng was arrested on Dec. 1 while changing planes, Canadian prosecutors said that she had taken part in a scheme to trick financial institutions into making transactions that violated American sanctions against Iran.

A warrant for Ms. Meng’s arrest was issued in the Eastern District of New York on Aug. 22, said John Gibb-Carsley, a lawyer with Canada’s Justice Department. Sino-American trade relations were at a low point then, with the United States imposing its second stage of tariffs on $50 billion a year in Chinese goods.

A Canadian judge then issued a warrant for Ms. Meng on Nov. 30, after it became known that she would change planes in Vancouver on her way to Mexico from Hong Kong. By the end of Friday, no bail had been set. The hearing is set to continue on Monday morning.

Huawei has said it has no knowledge of wrongdoing by Ms. Meng. In a statement released after the hearing on Friday, a company spokesman said, “We have every confidence that the Canadian and U.S. legal systems will reach the right conclusion.”



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