Rivers on The China Caper: the extradition request sounds like a political move rather than a technical legal matter.

By Ray Rivers

December 18th, 2018

BURLINGTON, ON

It is a bit of a mess.

Does anyone think Donald Trump had deliberately engineered this incident to get at both China and Canada? Is this part of his America First vision, to reduce America’s trade with its two largest partners? Or has he done us a big favour with this wake-up call?

I’m not a lawyer but it’s my understanding that terms of our extradition arrangement with the US requires some kind of common rules/laws between the nations. In this case Huawei executive Ms. Meng is charged with violating US sanctions on Iran now that the US has pulled out of the Obama-negotiated Iran nuclear agreement.

Those smiles didn’t last very long. This is what a trade war looks like. Donald Trump with Chinese leader -xi-jinping shaking hands.

But Canada supports the deal and doesn’t observe those specific sanctions. So I’d bet a dollar that the judge hearing this case will rule in favour of Ms. Meng.

Furthermore, since this is supposed to be a matter of law, the recent intervention, by Trump tweet, about the relevance of this case to US-China trade negotiations has jeopardized the US position and its legal case. The Donald has made his demand for extradition sound like a political move rather than a technical legal matter. So let me double up on that bet.

And the judge presiding over this case might want to note how few US prosecutions for even more severe corporate crimes stateside land American executives in the big house. In most cases the corporation gets fined and the CEO goes off to break the law another day.

If I’m right we might expect Ms. Meng to be on the next flight to Beijing – if only the Chinese government had kept their cool. But something about this being a matter only for the courts fell on deaf ears in that virtual dictatorship where everything is political. Their plan was to play a little tit-for-tat, detaining a couple of Canadian nationals in an attempt to strong arm the Canadian government into releasing Ms. Meng without a trial. So now were she to be released it will appear to all the world that Canada caved in to Chinese blackmail.

This is the last thing that Mr. Trudeau needs right now as he is preparing his campaign for re-election next fall. He is already facing legal challenges from four provinces and the opposition leader on the federal carbon tax. Albertan political leaders and journalists are giving him grief over the stoppage of the Trans Mountain pipeline expansion and threatening a movement for Alberta’s separatism, as idiotic as that sounds. The NAFTA 2, aka USMCA, is still awaiting confirmation in both Canada and the USA and Trumps tariffs on steel and aluminum are still in place.

The body language tells it all. Ms Meng, the Chief Financial Officer of a very powerful Chinese telecommunication giant being directed by a security officer who is paid to watch her every move while she is out on bail awaiting an extradition hearing.

With Canada seriously in the running for a UN Security Council seat this time, Mr. Trudeau is under enormous pressure to demonstrate strength to resolve this situation. And there are a number of tools available to the federal government should this matter not be resolved appropriately. Whether Ms. Meng is extradited or not Canada should demand that the hostages being held in China are released and an apology for their detention is provided. Further, the return of more normal relations should include a commitment to refrain from future hostage taking by authorities there.

Unless that happens:

1. Canada could require Chinese tourists to meet the compulsory visa requirements China requires of us;

2. We might want to review our immigration policies regarding China; and

3. Since Canada exports only between a third and a quarter of what it imports from China we could restrict imports through higher tariffs. Applying import tariffs in line with those of the US would send a strong message of our displeasure. It would also possibly sooth over any American complaints over our handling of this problematic extradition process.

It is a rare moment when Donald Trump deserves being paraphrased, but his comments on trade – that the US should not continue to have a massive and on-going trade deficit with China – is food for thought. The sheer volume of imports of low value Asian made junk that fills the shelves at Walmart, Canadian Tire and the Dollar Stores here poses an environmental as well an economic problem for this country.

China generates almost a third of global greenhouse gas emissions, more that twenty times what Canada generates and almost double the US levels. And our consumption of all those imported goods paints us as an enabler despite our efforts to be seen as one of the good guys.

Besides Canada’s biggest free trader, Mr. Trudeau, spent valuable political capital a little while ago trying to cement a formal (free) trading arrangement with that giant Asian economy. But Canada was rebuffed because of demands concerning human rights issues, the same kind of demands we also took to the table in the CETA (Europe), Trans Pacific and USMCA negotiations. China is clear that it has no intention of altering its human rights policies.

Finally, China has been manipulating its currency for decades, undervaluing it so its products would be more price competitive on global markets. Now that the Mr. Trump has diminished the value of the World Trade Organization it’s pretty much a bun fight out there. Which means any Chinese complaints over new trade barriers will be as meaningless as complaints about it’s currency manipulation have been.

Of course there would be impacts to the Canadian economy from imposing new tariffs. Exporters of raw materials and consumers of cheap Chinese goods will likely be affected in their pocket books. But in the end that may be a small price to pay to maintain our sovereignty and our dignity.

Ray Rivers writes regularly on both federal and provincial politics, applying his more than 25 years as a federal bureaucrat to his thinking.  Rivers was once a candidate for provincial office in Burlington.  He was the founder of the Burlington citizen committee on sustainability at a time when climate warming was a hotly debated subject.   Ray has a post graduate degree in economics that he earned at the University of Ottawa.  Tweet @rayzrivers

Background links:

China Snatches –     Huawei –     US Support –

US Extradition –     Canada in the Middle –     China and Climate Change –

China Free Trade Agreement –     Global Emissions –