Later this week a decision in a Canadian court is likely to bring the trade spat between the United States and China to a new degree of intensity. What will be decided is whether Meng Wanzhou will be extradited to the United States to face charges relating to the business dealings of the company she represents which it is claimed breached economic sanctions on Iran.
Meng is the chief financial officer of the giant Huawei corporation which deals in communications and is the daughter of that firms founder. She was arrested on December I when her plane touched down in Canada and as she was a transit passenger that arrest is legally complicated.
The coming court appearance is a mere formality. It will allow a judge to hear arguments on the US extradition request but ultimately extradition will be vested in the decision by Canada's Justice Minister. The problem is that Meng, as the CFO of Huawei is a very important person in the China pantheon of power. It is a provocation that China is not taking lightly and the Chinese have shown their displeasure by sanctions against Canadians in China that are very unsettling.
China has arrested two men, one a former diplomat and the other a business entrepreneur on December 10 and both are being held without access to a lawyer. It is a thinly veiled threat that what happens to them depends on what is the outcome in this Meng extradition case. To further ratchet up the tension, a Canadian serving a fifteen year prison sentence in China has been recalled to trial - and given a death sentence.
In many ways this attempt to extradite Meng is part of the western worlds attempt to isolate Huawei from integrating its technology in the communications sphere. The 5G phone system is being rolled out and there is a fear that Huawei technology will enable China to eavesdrop and scoop up western secrets to enable it to achieve both a military and trade edge to its advantage. Huawei has been excluded from tendering for communication contracts in many countries.
One of Australia's main exports is coal and recently China has cut back on deliveries. China is flexing its trade muscles in the ongoing import/export war with America and this may be delivering a warning that the ripples from the Meng case may spread widely. Even the thought of such a powerful Chinese woman being forced to face a court in America and being brought to trial is unthinkable in diplomatic circles.
Meng is on bail in Canada as the extradition case is decided and it is pertinent that she is living in one of the two great mansions she owns in that country. The fact that she was travelling abroad and using her domestic passport is part of the problem leading to this arrest and extradition request. It is customary that when important business people travel in circumstances where their business dealings are under both criticism and scrutiny they are safeguarded by using diplomatic passports. It is surprising that this seems to have escaped Chinese attention when Meng was travelling abroad.
It is also a warning to world travellers that they may become entangled in tit for tat reprisals if they have the misfortune to be in the wrong country when a serious spat between nations breaks headlines.
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