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Is China's Huawei actually a real threat?

Published : Wednesday, 19 December, 2018 at 12:00 AM  Count : 1313
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Is China's Huawei actually a real threat?

Is China's Huawei actually a real threat?

The context of the arrest of Huawei CFO MengWanzhou - a dangerous move by U.S. President Donald Trump's administration in its intensifying conflict with China - matters enormously. The United States requested that Canada arrest Ms. Meng in the Vancouver airport en route to Mexico from Hong Kong, and then extradite her to the United States. Such a move is almost a U.S. declaration of war on China's business community. The United States, led by an administration intent on asserting America's dominance over China, is pushing the world toward disaster.

The United States rarely arrests senior business people, U.S. or foreign, for alleged crimes committed by their companies. Ms. Meng is charged with violating U.S. sanctions on Iran. Yet, consider her arrest in the context of the large number of companies, U.S. and non-U.S., that have violated America's sanctions against Iran and other countries. In 2011, for example, JP Morgan Chase paid $88.3 million in fines in 2011 for violating U.S. sanctions against Cuba, Iran and Sudan. Yet Jamie Dimon wasn't grabbed off a plane and whisked into custody.

And JP Morgan Chase was hardly alone in violating U.S. sanctions. Since 2010, the following major financial institutions paid fines for such violations: Banco do Brasil, Bank of America, Bank of Guam, Bank of Moscow, Bank of Tokyo-Mitsubishi, Barclays, BNP Paribas, Clearstream Banking, Commerzbank, Compass, CréditAgricole, Deutsche Bank, HSBC, ING, IntesaSanpaolo, National Bank of Abu Dhabi, National Bank of Pakistan, PayPal, RBS (ABN Amro), SociétéGénérale, Toronto-Dominion Bank, Trans Pacific National Bank (now known as Beacon Business Bank), Standard Chartered and Wells Fargo.

None of the CEOs or CFOs of these sanction-busting banks were arrested and taken into custody for these violations. In all of these cases, the corporation - rather than an individual manager - was held accountable. In light of this record, Ms. Meng's arrest is a shocking break with practice. Yes, hold CEOs and CFOs accountable - but start at home in order to avoid hypocrisy, self-interest disguised as high principle and the risk of inciting a new global conflict.

Quite transparently, the U.S. action against Ms. Meng really seems to be part of the Trump administration's broader attempt to undermine China's economy by imposing tariffs, closing Western markets to Chinese high-technology exports and blocking Chinese purchases of U.S. and European technology companies. One can say, without exaggeration, that this is part of an economic war on China - and a reckless one at that.

Huawei is one of China's most important technology companies and therefore a prime target in the Trump administration's effort to slow or stop China's advance into several high-technology sectors. America's motivations in this economic war are partly commercial - to protect and favour laggard U.S. companies. The U.S. appears to be trying to target Huawei especially because of the company's success in marketing cutting-edge 5G technologies globally. The unprecedented arrest of Ms. Meng is even more provocative because it is based on U.S. extra-territorial sanctions. The U.S. would certainly not tolerate China or any other country telling American companies with whom they can or cannot trade.

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