Canada Affected by US-China Trade War

Canada Affected by US-China Trade War

Canada continues to evaluate the degree of participation that Huawei will have in the 5G network project. Last week, Justin Trudeau, the Canadian prime minister, declared that the decision will be based on “technological elements and national security, and not on political factors.” The United States and Australia completely closed the door to Huawei, while the United Kingdom has opted to allow a limited role for the Chinese company.

Canadians must make a decision in the framework of a trade war between Washington and Beijing, where suspicions of Chinese espionage also appear through one of its most important companies worldwide. Huawei has denied that its networks and devices can serve this purpose.

Last week, the US government included Huawei on a blacklist that made it impossible for US companies to do business with the Chinese company, citing risks to national security. The markets swayed substantially when Google announced its breakup with Huawei. However, President Donald Trump declared a three-month truce before the entry into force of the provision.

Canadian relations with Huawei and the Chinese regime are especially sensitive due to the Meng Wanzhou case . The vice president of the technology giant was arrested on December 1 at the Vancouver airport, at the request of the Americans. Meng, accused of fraud to allegedly violating US sanctions on Iran, is on bail while it is determined whether she will be extradited, but must comply with strict surveillance measures. Both Huawei and Beijing consider that the arrest was politically motivated.

Pressures to Trudeau on the participation of Huawei in the 5G network have reached Parliament. The Conservatives brand the prime minister as hesitant and demand that the veto of the company arrive soon. On the other side of the border, opinions have been heard in the same direction for months, by the Trump administration. However, Trudeau and several of his ministers have stressed that it is necessary to evaluate different aspects to benefit and protect Canadians.

Security experts have addressed the issue in national media. Wesley Wark, a professor at the University of Ottawa, wrote in the pages of The Globe and Mail that the Canadian government must find an intermediate solution, where the protection of sensitive information, the advantages for the consumer and the fruits of innovation coexist. means of alliances.

However, others suggest the ban to dry. Michel Juneau-Katsuya, formerly of the Canadian Intelligence and Security Service, told La Presse newspaper would be a mistake to accept that the firm participates at any level. “It’s a mirage when they tell us that Huawei has no ties to the Chinese government. You can not operate such a strategic company in China without these ties. China does not even authorize free access to the Internet, “he said.

Huawei has stressed that he has never had problems with Canadian laws in the 10 years he has been working in the country. He also stated that he shared with the authorities all the information necessary to be evaluated in terms of security with respect to the 5G network.

The company employs about 1,000 people in Canada, has invested nearly 500 million dollars (about 330 million euros) in research and development and has links with 10 universities in the country. In turn, it has hired the services of communication and public relations firms to improve its image in Canada, affected by the ravages of Washington and the detention of Meng Wanzhou, in which Beijing has shown harshness towards Ottawa.

The Canadian economy suffers the impact of the crisis with the Chinese. In March, China stopped buying canola seed from the North American country. In 2018, Canada exported little more than 5,000 million Canadian dollars (about 3,300 million euros) of this merchandise.

About 50% to China. The Chinese authorities justified the decision by citing “risks due to the presence of parasites”. Also, in early May, Beijing canceled the permits of two large pork companies, both from Quebec, on the grounds of “packaging and labeling problems”. The Chinese market is second in importance to the Canadian pig, only behind the United States.

Also the producers of soybeans and peas complain of Chinese bureaucratic obstacles in recent months. Statistics Canada, the federal agency responsible for collecting official data, published a few days ago that Canadian exports to China were reduced by 19.2% in the first quarter of the year compared to the previous quarter. In the same period, imports from China fell by 4%.

Meng Wanzhou, daughter of the founder of Huawei, will appear again in a court in Vancouver on September 23. This week, a Canadian parliamentary delegation is visiting China to request the release of Michael Kovrig and Michael Spavor, formally accused by Beijing of espionage, an action that Canada considers part of the reprisals for the arrest of the executive.

On May 21, when she reported the trip of the members of Parliament, Chrystia Freeland, Foreign Minister, admitted that relations between China and her country are “very difficult” in these times. Political analysts believe that the decision on Huawei’s participation in the 5G network in Canada could be known near or after the elections (scheduled for October 21) and, in turn, not a few jurists have expressed that the issue of Meng Wanzhou in courts could last for months or years. It seems that the frictions between Ottawa and Beijing will not be left behind in the short term.

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