Beijing detains former Canadian diplomat Michael Kovrig after Chinese Huawei executive’s arrest

A former Canadian diplomat has reportedly been detained in China following the arrest of a top executive for a Chinese telecoms giant in Canada earlier this month.

It was not immediately clear if the cases were related, but Canadian analysts had already predicted China would retaliate after the arrest of Huawei chief financial officer Meng Wanzhou, which occurred 1 December at the request of US authorities.

The former diplomat is Michael Kovrig. He works for the International Crisis Group, which said it was seeking his prompt and safe release.

Ms Wanzhou is accused by US officials of misleading multinational banks about Huawei’s control of a company operating in Iran, putting the banks at risk of violating US sanctions which would incur severe penalties, according to court documents.

China had previously threatened severe consequences unless Canada released Ms Wanzhou immediately. Canadian Prime Minister Justin Trudeau responded in a statement that the matter was one for the courts to decide.

Ms Wanzhou — the 46-year-old daughter of Huawei’s founder — was arrested as she was changing planes in Vancouver. In a sworn affidavit, she said she was innocent and would contest the allegations against her at trial if she is surrendered to the United States.

Her arrest has roiled markets over fears it would exacerbate tensions between the United States and China, already at a high over tariffs. The two sides have agreed to trade negotiations that must be concluded by March.

Beijing has demanded the executive’s immediate release and threatened continued “consequences” for Canada. However, both Chinese and US officials appear to be avoiding linking her arrest to the trade dispute.

Canadian officials said they were not immediately able to confirm that Mr Kovrig was in detention, despite two sources telling Reuters the former diplomat had been detained Tuesday morning.

China’s Foreign Ministry and Ministry of Public Security did not respond immediately to questions about Mr Kovrig’s detention.

Huawei is the world’s largest supplier of telecommunications network equipment and second-biggest maker of smartphones, with revenue of about $92 billion last year. Unlike other big Chinese technology firms, it does much of its business overseas.

US officials allege Huawei was trying to use the banks to move money out of Iran. Companies are barred from using the U.S. financial system to funnel goods and services to sanctioned entities.

Huawei and its lawyers have said the company operates in strict compliance with applicable laws, regulations and sanctions of the United States and other parties.

“We will continue to follow the bail hearing tomorrow. We have every confidence that the Canadian and US legal systems will reach a just conclusion,” the company said on Monday.

Reuters contributed to this report