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Everything That Happened With Huawei While You Were Sleeping



Photo: Gizmodo

Huawei's chief financial officer, Meng Wanzhou, was arrested in Canada on behalf of the United States last weekend and the incident captured the global spotlight after The arrest was publicly revealed Wednesday evening. Meng was arrested for alleged violation of US sanctions against Iran, but we will not officially hear the allegations until his bail was released later in Vancouver today.

China demanded that Meng be released immediately, while American businessmen were warned of China. It's a fast-moving story that has attracted everyone's attention, from Wall Street bankers to Silicon Valley technicians. But what happens next? We have a rundown of everything you missed while you were asleep.

Photo of the file of CEO of Huawei Ren Zhengfei speaking at a conference in St. Petersburg, Russia, on June 22, 2012
Photo: AP [19659006] The American technology executives have warned of trips to China

Managers of the technology industry have been warned to go to China, while some experts speculate that the Chinese government could take revenge for the arrest of Huawei's Meng. 46-year-old Meng, who is sometimes called Sabrina or Cathy, is not just Huawei's CFO. She is also the daughter of founder Ren Zhengfei, who has close ties to the People's Liberation Army, the name of the Chinese armed forces.

Shaun Rein of the China Market Research Group told the Sydney Morning Herald today: "If I were a great level executive at Google or Cisco I would not visit China anytime soon."

Bill Bishop, author of the Asia-centric synoptic bulletin, it seems to think that China would be stupid to arrest an American executive, but bears his bet on the potential of an arrest:

I have seen speculation that China could take revenge by arresting a US technical manager. It would certainly be explosive, but I'm not sure if Beijing would do it without a very clear legal case, as it would undermine the massive propaganda campaign the party has undertaken to portray the PRC as open to foreign companies and as a defender of global trade system. However, if I were a US technical executive, I would delay a trip to China for a while or I would go on holiday if I were there …

I suppose the takeaway is that if you're an American business man who wants to go to China, you know the risks at the moment. And it's probably not worth it until things settle down.

[Sydney Morning Herald and Sinocism]


Actually, it could be a banking scam

Why Meng was arrested ? The reason why we continue to listen is that Huawei has violated US sanctions against trade relations with Iran. But this may not be what the American authorities ultimately use to pursue Meng. It could very well be accused of bank fraud.

Reuters reports:

The United States has been watching at least since 2016 whether Huawei has shipped US-based products to Iran and other countries in violation of US export laws and sanctions, Reuters reported in April.

More recently, the probe has included whether the company has used HSBC Holdings Plc to conduct illegal transactions involving Iran, people said.

Companies can not use the US financial system to package goods and services to sanctioned entities. If the manufacturer of mobile phones and telecommunications equipment conducted such transactions and then cheated HSBC on their true nature, they could be guilty of bank fraud, experts say.

Huawei, who appointed President Liang Hua as CFO while Meng is in detention, must obey US sanctions against doing business with countries like Iran if he wants to have a legal presence in the United States. And if they use American banks to violate sanctions, this becomes a problem for them.

[Reuters]


The Japanese Prime Minister (right) laughs in the vicinity of the American president and the indestructible co-conspirator Donald Trump on November 30, 2018 in Buenos Aires, Argentina
Photo: Getty Images

Japan will ban Huawei and ZTE from government contracts

Japan will prohibit the purchase of Huawei and ZTE technology (both Chinese companies) for government contracts, a move that is taken into account in other countries aligned in the United States like New Zealand.

CNBC, citing the Yomiuri newspaper in Japanese, states that procurement rules may have changed from Japan as Monday next week. No official statement has been issued by the Japanese government

Anonymous sources in Japan mention the same security concerns as other countries such as Australia, the United Kingdom and Canada. These concerns are related to the close ties between Huawei and ZTE with the Chinese government and fears that Chinese electronics can be used to spy on not only Japanese citizens but also Japanese government officials.

[CNBC]


The President of China Xi Jinping meets President Donald Trump on December 1, 2018, the same day he was arrested Meng
Photo: AP [19659013] President Trump knew that the arrest would happen?

Canadian Prime Minister Justin Trudeau says his government was not involved in the arrest of Meng, but that he was made aware a few days earlier. But how much did President Trump of the arrest know about it while attending his working meeting with Chinese President Xi Jinping over the weekend? The answer? He did not know much

. President Trump had no idea that Huawei's execrer would be arrested. At least that's what national security adviser John Bolton mentioned yesterday at National Public Radio.

From NPR:

[NPR]: All right. Did the president know in advance that this arrest would come?

[John Bolton]: You know, I do not know the answer to this. I knew it beforehand, but this is something that comes from the Department of Justice and this kind of thing happens quite frequently. We certainly do not inform the president about each of them.

OK. So did you know that during that weekend with the president of China, you knew that this arrest was happening?

Well, you know, there are many things that are pending at any given time. You do not know exactly what will happen in terms of a particular police action, which depends on many other circumstances.

Trump has yet to tweet directly on the Huawei case, but it is rather mindbearing that we have a situation where the president may have been completely obscure about this situation – an international incident that is not going away anytime soon and has important implications for the US stock market and the broader US technology sector.

Trump appears instead to be very interested in the investigation of Robert Mueller this morning.

And it was all in less than an hour.

Perhaps the president can squeeze in a comment on the Meng case and our New Cold War between tweet anger over Russia's investigation. But we are not holding my breath. It seems that today has his hands full.

[National Public Radio]


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