US-China: My Way Or The Huawei

US-China: My Way Or The Huawei

Trade negotiations between the US and China took another step forward yesterday, with the Chinese taking steps to lower tariffs on US automobiles from 40 to 15 percent. The move further eases tensions after Presidents Trump and Xi declared a "trade truce" in Buenos Aires earlier this month.


In the background, though, a diplomatic and legal spat is unfolding that could prove far more consequential for the future of trade talks, and potentially the broader US-China relationship.

My colleague Willis Sparks wrote on Friday about the arrest of Meng Wanzhou, a top executive at the Chinese telecom giant Huawei , who was detained in Canada and is fighting extradition to the US over charges related to alleged violations of Iran sanctions. On Monday, a Canadian diplomat and aid worker, Michael Kovrig, was taken into custody in Beijing. The US is reportedly considering issuing a travel advisory for all Americans planning to visit China.

With so much at stake, here's a quick rundown on the latest twist in the US-China trade war:

The short-term problem: Washington and Beijing appear intent on not letting Meng's arrest upend their fragile trade truce. But the Huawei affair will probably make it harder to reach a meaningful breakthrough ahead of a March 1 deadline – after which US tariffs will rise on billions of dollars of Chinese goods. The arrest of Kovrig may be intended as a shot across the bow intended to influence the course of Meng's case.

While Meng was released on bail on yesterday, there's still a lot that could go wrong between now and March 1. Any appearance that she is being humiliated – by being put on a plane to the US in shackles, say – will inflame nationalist fervor around the incident in China and hinder Xi's ability to negotiate with the US on trade. President Trump, for his part, has hinted that the US might intervene in Meng's case if it was "good for what will be certainly the largest trade deal ever made." But he may have limited influence over how the case unfolds, given that it's primarily a law enforcement matter.

The longer-term problem: Even if Meng is eventually freed, Huawei itself could still face serious legal jeopardy in the US. Recall that Huawei's smaller rival ZTE was nearly pushed into bankruptcy earlier this year when the Commerce Department banned it from acquiring US technology for seven years in a similar sanctions case, before Trump granted it a last-minute reprieve.

China hawks in the Trump administration and Congress will almost certainly now push for similar treatment of Huawei. If they succeed, it would be politically explosive: Huawei is one of the world's leading suppliers of next-generation 5G networking technology, and it's much more critical to China's long-term tech and industrial ambitions than ZTE. China would likely see any move to restrict the export of US parts to Huawei as tantamount to a declaration of economic war.

The bottom line: Forget the car tariffs and other cosmetic trade fixes – if you want to know where the US-China relationship is going, keep an eye on what happens with Meng and Huawei.

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Back in August, when the Taliban took over, we asked whether anyone in the international community would recognize them. Now it looks like things are heading that way.

This week, the Kremlin hosted a summit with the Taliban that was attended by China, India and Pakistan, as well as all five Central Asian Republics.

The domestically-focused US, however, wasn't there. The US continues to maintain that the Taliban can't be trusted. But does it matter? In 2021 does a Taliban-led government even need American recognition to function and thrive?

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Taking place on October 21 and 22, the Sustainability Leaders Summit will go beyond preexisting narratives and debate priorities for governments and industries ahead of COP26. Placing the spotlight on Asia's role in the global sustainability agenda, the event will address whether Asian countries and companies can achieve shared sustainability goals, and what is needed to help get them there. The summit will be co-hosted by Tak Niinami, CEO of Suntory Holdings, and Ian Bremmer, founder and president of Eurasia Group and GZERO Media. We will address three key questions: How can Asian countries, with the help of the private sector, achieve shared Sustainability Goals? Why does this matter? And what are the policy changes needed to bring it about?

Attendance is free and open to the public. Register to attend.

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For Kevin Rudd, former Australian PM and now CEO of the Asia Society, the science on climate change is pretty much done, so the only unresolved issues are tech and — more importantly — lack of political leadership. He can't think of a single national political leader who can fill the role, and says the only way to get political action on climate is to mobilize public opinion.

Rudd joined for the first of a two-part Sustainability Leaders Summit livestream conversation sponsored by Suntory. Watch here and register here to watch part two Friday 10/22 at 8 am ET.

The minutiae of supply chains makes for boring dinner table talk, but it's increasingly becoming a hot topic of conversation now that packages are taking much longer to arrive in the consumer-oriented US, while prices of goods soar.

With the issue unlikely to be resolved anytime soon, right-wing media have dubbed President Biden the Grinch Who Stole Christmas, conjuring images of sad Christmas trees surrounded by distraught children whose holiday gifts are stuck somewhere in the Pacific Ocean.

It hasn't been a good run for Uncle Joe in recent months. What issues are tripping him up?

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Ian Bremmer shares his insights on global politics this week with a look at the NBA's latest rift with China, Brazil's Senate investigation, and COVID booster shots.

China wipes Boston Celtics from NBA broadcast after the "Free Tibet" speech from Enes Kanter. Is NBA boxing itself into a corner?

Nice mixed sports metaphor there. NBA has some challenges because they are of course the most progressive on political and social issues in the United States among sports leagues, but not when it comes to China, their most important international market. And you've seen that with LeBron James telling everyone about we need to learn better from the Communist Party on issues like Hong Kong and how Daryl Morey got hammered for taking his stance in favor of Hong Kong democracy. Well, Enes Kanter's doing the same thing and he's a second-string center. Didn't even play yesterday and still the Chinese said that they were not going to air any Boston Celtics games. Why? Because he criticized the Chinese government and had some "Free Tibet" sneakers. This is a real problem for a lot of corporations out there, but particularly publicly, the NBA. Watch for a bunch of American politicians to make it harder for the NBA going forward, saying how dare you kowtow to the Chinese when you're all about "Black Lives Matter" inside the United States. No fun.

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Jon Lieber, head of Eurasia Group's coverage of political and policy developments in Washington, shares insights on US politics:

A Trump media platform? Is this for real?

This week, President Trump announced his potential return to social media through the creation of his own digital media platform that's going to merge with an existing publicly-traded company in a deal known as a SPAC. These deals are increasingly popular for getting access to capital, and it seems like that's where President Trump is headed.

The publicly-traded company's stock was up on the news, but it's really hard to see this coming together. The Trump media company claims it wants to go up against not only Facebook and Twitter, but companies like Amazon and cloud computing and even Disney providing a safe space for conservatives to share their points of view. The fact of the matter is, conservatives do quite well on existing social media platforms when they aren't being kicked off for violating the terms of service, and other conservative social media platforms that have attempted to launch this year haven't really gone off the ground.

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Protests in Sudan: Protests are again shaking the Sudanese capital, as supporters of rival wings of the transitional government take to the streets. Back in 2019, after popular demonstrations led to the ouster of longtime autocrat Omar al-Bashir, a deal was struck between civilian activists and the army, in which a joint civilian-military government would run the country until fresh elections could be held in 2023. But now supporters of the military wing are calling on it to dissolve the government entirely, while supporters of the civilian wing are counter-protesting. Making matters worse, a pro-military tribal leader in Eastern Sudan has set up a blockade which is interrupting the flow of goods and food to the capital. The US, which backs the civilian wing, has sent an envoy to Khartoum as tensions rise, while Egypt, the UAE, Saudi Arabia, and Turkey are all vying for a piece as well.

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