Huawei case puts two-way strain on Canada-China business confidence
- Survey finds Canadian companies hardest hit but Chinese firms operating in Canada also report negative impact
- Tensions date from arrest of Huawei executive Sabrina Meng Wanzhou
More than half of Canadian companies operating in China have changed, postponed or cancelled their business plans in the wake of the arrest of Huawei executive Sabrina Meng Wanzhou in Vancouver six months ago, according to a new report into business sentiment by Canada’s de facto chamber of commerce in Beijing.
The Canada China Business Council did not name Meng, or telecommunications giant Huawei, but found both Canadian and Chinese companies surveyed were facing challenges “stemming from recent bilateral political and legal tensions” in the period from December 1, 2018 – the date of Meng’s arrest – to March 1, 2019.
The survey, conducted every two years, covered 226 Canadian companies and 28 Chinese firms operating in each other’s markets and found that, while the negative impact had been two-way, Chinese companies had suffered less.
China has been Canada’s second largest trading partner since 2003, after the United States, but relations have deteriorated sharply, in what many observers have seen as retaliation over Meng’s detention. She is currently on bail pending an extradition hearing for her to stand trial in the US on fraud charges and breaches of US sanctions on Iran.
Canada has said more than a dozen Canadians – including former diplomat Michael Kovrig and businessman Michael Spavor, both accused of endangering state security – have been detained in China, which has also stopped imports of Canadian food products, including canola and pork.