Trading blows: Canada next in China’s crosshairs?

The exterior of the Alouette Correctional Centre for Women, where Huawei CFO Meng Wanzhou is being held on an extradition warrant, is seen in Maple Ridge, British Columbia, Canada December 8, 2018. — Reuters pic
The exterior of the Alouette Correctional Centre for Women, where Huawei CFO Meng Wanzhou is being held on an extradition warrant, is seen in Maple Ridge, British Columbia, Canada December 8, 2018. — Reuters pic

BEIJING, Dec 10 — Canada’s arrest of a top executive of Chinese telecom giant Huawei has put the country in the crosshairs of Beijing, which has warned of “grave consequences” over the case.

China’s foreign ministry issued the warning after it summoned Canada’s ambassador on Saturday and called for the release of Huawei’s chief financial officer, Meng Wanzhou, who was held on a US warrant on charges related to alleged sanctions-breaking dealings with Iran.

While the ministry did not spell out what the consequences might be, Beijing has long used economic measures to punish countries that offend it.

AFP takes a look at what Canada could face, and what other nations have endured in the past:

Canada trade hopes

China’s state-run Global Times, a nationalist tabloid, cited experts as saying the consequences may include trade sanctions, a degradation in bilateral ties and fewer visits to Canada by Chinese tourists and businesspeople.

Canada exported goods worth US$18.2 billion to China last year, and it would be “very easy” for Beijing to shut down key energy and agricultural products with bans or boycotts, said Shaun Rein, the founder of Shanghai-based China Market Research Group.

The spat could also endanger exploratory talks on a free trade agreement between Ottawa and Beijing that have been ongoing for two years.

“I think the free trade agreement is definitely in a precarious situation, because Canada needs it with China more than China needs it with Canada, economically,” Rein said.

China could also hit back by detaining an executive from a large Canadian company, Rein added.

S. Korea’s tourism hit

Last year, after Seoul agreed to deploy a US missile defence system that Beijing considered a threat to its own military capability, Beijing banned Chinese tour groups from going to South Korea.

South Korean retail giant Lotte Group, which provided land for the THAAD system, became a target of Chinese nationalist sentiment, as online shoppers and internet trolls launched a boycott and protestors gathered in front of stores, costing Lotte hundreds of millions of dollars.

Several Chinese companies also joined the boycott and Chinese authorities closed nearly two dozen Lotte retail stores across the country, citing safety regulations.

Norway ties frozen

In 2010, China froze ties with Norway and suspended talks on a bilateral free trade deal after the Nobel Committee awarded the Peace Prize to jailed Chinese dissident Liu Xiaobo.

The spat hit Norway’s salmon producers hard, with exports to China plummeting in following years.

Relations returned to normal six years later, after the Norwegian government said that it fully respects China’s development path and social system, and pledged not to support actions that undermine Beijing’s core interests.

Taiwan visits cut

More recently, Taiwan has experienced a sharp drop in mainland tourists as cross-strait relations have worsened under President Tsai Ing-wen, whose party traditionally advocates independence from China.

In contrast with a boom in mainland tourists under her Beijing-friendly predecessor Ma Ying-jeou, the island suffered a 42 per cent drop after Tsai took office in 2016.

Tourism operators attributed the decline to a more negative portrayal of Taiwan in Chinese media, along with scaled-back promotion of tours by major Chinese travel agencies. — AFP

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