Putting squeeze on Canada

Putting squeeze on Canada

No early resolution of Canada’s dilemma as national egos get involved

Canada is an advanced, industrialised and affluent country and a magnet for economic immigrants, including from India, but it is currently finding itself squeezed, as a poor, developing country would have, between an aggressive China and a United States determined to, at least, partly thwart its ambitions. The immediate cause of the dispute centres round the Chinese telecommunications company Huawei which has emerged as one of the world’s leaders in its field, rivalling its well established Western competitors. There appears to be no early resolution of Canada’s dilemma for, in addition to commercial and strategic competition, national egos have also got involved. It is noteworthy that Canada along with the UK, Australia and New Zealand is partnering the US in the strategic and technological targeting of Huawei. This is adding to the complexities of the situation.

US authorities have accused Huawei of violating its laws imposing sanctions against Iran. In particular, they have alleged that the company’s Chief Financial Officer Meng Wanzhou had misled banks by denying that Skymet a Hong Kong based company selling US technology to Iran had no connection with Huawei when it actually did. This charge led a US court issued a warrant for Meng’s arrest in August last year. Thereafter on December 1 she was arrested while transiting Vancouver. The Canadian authorities did so to extradite her to the US. She is currently out on bail in Vancouver while legal proceedings for her extradition continue.

China reacted furiously at Meng’s arrest. Huawei has iconic status in the country and she is the daughter of its founder Ren Zhengfei. She is tipped to take over the company from him. There is little doubt that the father and daughter are leading members of the Chinese political and business elite. Ren Zhengfei was with the Chinese army and left it to set up the company in 1987. From a modest start manufacturing electronic switches for communication equipment Huawei is today a Fortune Five Hundred company with a world-wide presence and current revenues of almost US $ 100 billion. The Chinese government supported its rise. It is particularly impressive that Huawei has spent large amounts on research and development of technology and products. It has R&D centres in many countries including in Bengaluru.   

Almost immediately after Meng’s arrest China hit back. Two Canadian nationals living in China, Michael Kovrig and Michael Spavor were arrested for “endangering China’s national security”. The timing of these arrests clearly indicated that China signalled to Canada that it would retaliate hard. When the Canadian media and sections of public opinion pronounced the arrests as unjustified China sent another strong signal through a pugnacious article of its ambassador in Ottawa, Lu Shaya in which he accused Canadians of double standards.

Shaya wrote “When China called on the Canadian side to release Meng and ensure her legal and legitimate rights and interests, those elites claimed in the media that Canada is a country of rule of law and has an independent judiciary and therefore must comply with the judicial proceeding. However, in the case of detention of Canadian citizens in China who violated China’s law, those elites completely dismissed China’s law and presumptuously urged China to release their citizens”. Shaya especially pointed out that Meng was not accused of violating any Canadian law.

Responding to the charge that China was using Huawei to undertake espionage the ambassador implicitly accused Western countries of cyber robbery and spying on “foreign governments, enterprises and individuals”. Shaya went on to assert that western countries cannot claim to constitute the international community ignoring the rest of the world. All this only indicated “Western egotism and white supremacy”.

The truth is that in China justice is the hand-maiden of the communist party. This is especially so in judicial matters pertaining to foreigners. Western systems of jurisprudence are generally independent of governments but experience shows that judges do take the suggestions of governments while taking decisions in matters where the external interests of a country are involved. However, as democratic governments seek to maintain the appearance of judicial independence they do not wish to admit that they have influenced the courts; they want such matters to be settled discretely. That is difficult in high profile issues.

More recently the Meng matter has acquired greater contentiousness for a Chinese appellate court has imposed the death penalty on a Canadian national, Robert Schellengberg, who was held guilty of attempting to smuggle narcotics out of China. Schellengberg was arrested some years ago and a lower court sentenced him to 15 years’ imprisonment about two months ago. The speed with which appellate proceedings were held show that the death sentence is meant to put greater pressure on Canada.

The key to resolving the Meng issue lies actually with President Trump who has already said that he would intervene if it is good for the US. Naturally, at a time when the US and China are locked in a bitter trade dispute on which negotiations are on-going the fate of the Chinese and Canadian nationals are linked to the fate to trade talks. It is unlikely that either the US or China will take matters relating to these individuals over the brink but meanwhile they suffer.

Behind all this though is US-China rivalry. As a prominent US newspaper noted “The US and China have also been locked in a struggle for high-tech supremacy in a race that has increasingly taken on political undertones this year”. At stake is who will dominate the markets for 5 G systems. 

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