Relieved at Meng return, especially HSBC

Editorial | Mary Ma 27 Sep 2021

The almost simultaneous release of top Huawei executive Meng Wanzhou in Vancouver and Canadians Michael Kovrig and Michael Spavor in China smacked of one of those prisoner swaps made at the height of the Cold War between the West and Soviet Union after World War II.

So, has a new cold war begun?

That is, of course, too soon to say.

A new cold war would have far reaching impact on the world, so one certainly hopes that what happened over the weekend signaled the exact opposite.

For over 1,000 days, it is an open secret that the Meng case lies close to the center of tensions between Beijing and its Western detractors.

Soon after her arrest at Vancouver airport on a US warrant in relation to Huawei's alleged breaches of US sanctions on Iran, Beijing arrested the Michaels and came down harder on a third Canadian, sentencing him to death.

In the latest turn of events, the US Department of Justice issued a release that proferred details of the deferred prosecution agreement reached with Meng on Friday.

The deal struck meant Meng didn't plead guilty but admitted the facts behind the charges, including making multiple representations regarding Huawei's business operations in Iran in order to preserve the company's banking relationship with a financial institution.

There's no winner in the case, not even HSBC although the bank can now breathe a sigh of relief.

The charges against Meng will be dismissed next December on the proviso that neither Meng nor her lawyers publicly dispute the agreed facts between now and then. Part of the deal also has it that the prosecution may sue Huawei.

In any case, what just occurred was probably the most surprising instance of hostage diplomacy in our post-war period.

It has been argued that Beijing could have waited to release the Michaels later so that it wouldn't look bad as it would have looked like an exchange of prisoners.

Perhaps Beijing didn't mind people seeing it in that perspective or it may even have wanted to use the release as a warning to the world. It's also probable that Beijing had little choice but to put the Michaels on a plane at the same time as Meng was being escorted to a jet already waiting at the tarmac. In all these, the three pivotal figures in this drama were all accompanied by diplomats from their own country.

Canadian Prime Minister Justin Trudeau, who was only just re-elected, didn't make the announcement until after the plane bearing the Michaels had left Chinese airspace.

What the three sides didn't allude to were the political considerations behind the swap. For the American side, this must come from the White House.

The swap took place not long after President Xi Jinping and his US counterpart, Joe Biden, conversed on the phone.

What did they say? Statements they made after the call offered no useful information besides repeating each other's well-known points of view.

Developments since then have been mixed, first with forming of a new military pact, Aukus, by Australia, the UK and US to equip their close ally Down Under with nuclear submarines and then the Meng-Michaels swap deal.

Although it's too soon to make predictions, the swap should at least help to ease tensions.

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