The United States started a trade war with China. The Justice Department requested Canadian authorities to arrest Meng Wanzhou, the chief financial officer of China’s telecom giant Huawei, on allegations that she had violated sanctions against Iran by committing financial fraud.
China hasn’t taken Meng’s arrest very well. It viewed Meng’s arrest as a politically driven “kidnapping” aimed at curbing China’s technological ambition and forcing China to make trade concessions. Beijing feels it has lost face internationally and in front of its domestic, nationalistic audience. Therefore, Beijing has been in revenge mode. However, its main target so far has been not the United States, but Canada.
Since Meng’s arrest, China’s foreign minister has summoned the Canadian ambassador to China, John McCallum, multiple times, to lodge a “strong protest” and tell him Meng’s arrest caused “serious damage to Sino-Canada relations.” Beijing demanded the immediate release of Meng, or Canada would face “grave consequences” for Meng’s arrest. The same Chinese foreign ministry also summoned the U.S. ambassador to China, Terry Branstad, a day after meeting the Canadian ambassador, to protest Meng’s arrest as being “unreasonable.” In diplomatic language, the U.S. ambassador was treated with kid gloves.
The Canadian government has tried very hard to explain to Beijing that Meng’s arrest was not politically driven and its timing, which took place on the same day as the President Trump and Chinese President Xi Xinping’s meeting at the G20 in Argentina, was pure coincidence. The Justice Department launched a criminal probe into Huawei’s dealings in Iran in April 2017. The arrest warrant for Meng was issued in August by the U.S. District Court for the Eastern District of New York, and Meng was charged with “conspiracy to defraud multiple international institutions.” To U.S. authorities, arresting Meng in Canada was a natural choice, because Meng stopped traveling to the United States in 2017, but she does travel to Canada regularly as a legal resident there.
Second, the United States and Canada have an extradition treaty. According to Canadian legal experts, “Under the terms of the extradition treaty, the U.S. could request Meng’s arrest in Canada if she was wanted in connection with conduct considered criminal in both Canada and the United States, and if the offence carries a jail sentence of a year or more. Once that threshold is met, the treaty compels Canada to act.”
But China rejects Canada’s explanation outright. For China, a country with no independent judiciary, such an arrest of a high-profile individual is always a political act. When China was ready to send its own message, Canadians didn’t have to wait very long to find out what grave consequences China warned them of.
Beijing Retaliates By Mistreating Canadians
Last week, Beijing arrested two Canadians on charges of “endangering national security.” One is Michael Kovrig, a former diplomat and now a senior adviser with the International Crisis Group (ICG). According to ICG’s website, Kovrig “conducts research and provides analysis on foreign affairs and global security issues in North East Asia, particularly on China, Japan and the Korean peninsula.” China declared that ICG is not a legally registered non-governmental organization (NGO) in China. Thus, Kovrig might have also violated China’s notorious foreign NGO law, which gives Beijing the ability to prevent international organizations it doesn’t like, such as human rights organizations, from operating legally in China.
Another Canadian taken by Chinese authorities is businessman Michael Spavor. Spavor runs a company called Paektu Cultural Exchange. He rose to fame after arranging former NBA star Dennis Rodman’s visit to North Korea in 2013. For a few days, Beijing had granted Canadian consulate access only to Kovrig, not Spavor. Eventually, Canada’s ambassador to China was finally able to see Spavor. Secretary of State Mike Pompeo offered to assist Canada to get both Spavor and Kovrig released.
Many rightfully suspect the timing and the trumped up charges of the two Canadians is Beijing’s way of sending a clear message to Ottawa: we will punish your citizens until you release Meng.
After Meng’s arrest, the Chinese consulate in Canada had immediate access to her. She has legal counsel and everything has been done to ensure her due process and her legal rights are protected under Canadian law. She was released back to her mansion in Canada on bail last Tuesday. Don’t expect either Spavor or Kovrig to receive similar treatment or have their legal rights protected in China.
People who know Beijing’s interrogation methods well worry that both Spavor and Kovrig may be going through some difficult times, including possible sleep deprivation and starvation. A former diplomat once arrested in China told ABC news what he is likely facing:
The lights will always be on in his room. There will always be a minder present. They will put a lot of psychological pressure on him to try and have him break down and admit to anything … They render the feeding schedule unpredictable. He will be subject to long hours of questioning.
No one will be surprised if either Spavor or Kovrig is made to “confess” their non-existent “crimes” on TV, because it has been common for Chinese authorities to force political prisoners to make scripted confessions on state TV since Xi revived this Mao-era public humiliation tool.
Signs from China suggest the arrest of the two Canadians is only the beginning, not the end of China’s retaliation. Last Friday, after the arrest of the two Canadians took place, China’s Foreign Ministry continued to pressure Canada to release Meng and said Canada’s action has caused “public anger” in China. Chinese consumers reportedly are boycotting Canadian imports.
Why does China pick on Canada and not the United States? China views Canada as the easier target. China has a much bigger economy and a more powerful military than Canada. The Sino-Canada annual trade volume is about $60 billion, which is pocket change compared to the Sino-U.S. annual trade volume of $426.71 billion. Beijing probably feels that it can retaliate against Canada in this way without much consequence, while placating a nationalistic domestic audience’s furor over Meng’s arrest.
China Needs Good U.S. Relations
Even though China may be more furious with the United States, Beijing needs Washington more than it likes to admit. Fresh economic data out of China show that China’s economic downturn has deepened, partially due to internal structural issues and partially due to the trade war with the United States. Xi is under enormous pressure to pump up China’s economy, because Chinese people will only tolerate their one-party rule, massive surveillance system, poor air quality, and lack of political rights as long as the economy is growing, everyone has a job, and people’s standards of living keep going up.
Throughout China’s history, a poor economy has been the precursor for social unrest, which often led to overthrowing those at the top of the power structure. This is something China’s leadership, especially Xi, will do anything to prevent from happening. To keep China’s economy growing, Xi needs to settle trade disputes with the United States. This explains why China still commits to trade negotiations with the United States and recently Beijing announced it would lower tariffs on U.S.-made cars from 40 percent to 15 percent, while it keeps punishing Canada for Meng’s arrest.
Besides depending on the United States for economic growth, China has yet to catch up with the United States’ lead in technology and military power. While Trump can be very unpredictable, one thing he has shown to the rest of world is that if you play hardball against him or the United States, he will predictably punch back twice as hard.
China Would Love to Turn the Tables
China doesn’t have the capacity to directly challenge the United States, at least not yet. This reality leaves the United States the only nation that can keep China’s aggression in check. For instance, the United States is the only country regularly conducting Freedom of Navigation Operations in South China Sea, much to China’s annoyance. Another example is that last week, National Security Adviser John Bolton unveiled Trump’s Africa strategy, which focuses heavily on pushing back China and Russia’s “predatory practices” and expanding influence across the region. No other country has the military strength and economic power to keep China’s aggression in check like the United States does.
However, the gaps between China and the United States in areas such as technology and military are shrinking fast and furiously. Only last Friday, we learned Chinese hackers breached U.S. Navy contractors to “steal everything from ship-maintenance data to missile plans.” Such hacking isn’t only about stealing military secretes. According to officials, hacking is also a way for China “to demonstrate it can pose a different kind of threat even if it is unable to engage the US military ship-to-ship or airplane-to-airplane.”
If one day China overtakes the United States economically and militarily, China will treat the United States the same way it treats Canada today or even worse. The only way to avoid that scenario is for the United States to continue growing its economy through innovation, deregulation, and tax reform. In addition, the United States should never shortchange its military. With that in mind, here is a message for the upcoming Democrat House majority: If you spend all your energy and resource on taking down Trump, you are doing no one but China a favor.