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Tech: A top executive at Chinese tech giant Huawei was arrested. Here's how the incident could escalate Trump's trade war

Meng Wanzhou, the CFO of Huawei, was arrested in Canada this week.

Huawei's CFO was arrested in Canada, on request of the U.S. Here's what you need to know, and why it could escalate Trump's trade war.

  • Huawei, a Chinese tech giant, is making headlines after one of its top executives, Meng Wanzhou, was arrested in Canada at the request of the U.S. this week.
  • Huawei is the second-largest smartphone maker in the world, behind only Samsung.
  • Meng was reportedly arrested on suspicion of violating U.S. trade law by exporting products from the U.S. to sanctioned countries like Iran.
  • The arrest could have bigger implications for Huawei, whose practices have been the subject of a yearslong federal investigation, as well as for the escalating trade war between U.S. and China.
  • Here's what you need to know about Huawei and Meng Wanzhou, and the events leading up to this incident.

Authorities in Canada have arrested the chief financial officer of the Chinese company Huawei, reportedly on suspicion of violating U.S. trade sanctions on Iran.

For Americans, Huawei may not be a familiar name. But the tech giant is actually the second largest smartphone manufacturer in the world, behind only Samsung, after recently pulling ahead of Apple.

This incident threatens to have major implications on the relationship between U.S. and China, which has already ordered Canada to "immediately release" Huawei executive Meng Wanzhou.

Here's what you need to know about Huawei, Meng Wanzhou, and how this arrest could escalate the U.S. trade war with China.

Huawei is a massive tech company producing telecommunications services, enterprise tech, and consumer devices, like smartphones. The company sells its products in more than 70 countries.

Source: Huawei

The company raked in almost $93 billion in sales last year, which puts it about on par with Microsoft. Huawei is the largest maker of telecommunications equipment in the world, and the world's second largest smartphone manufacturer behind Samsung.

Source: Business Insider, Forbes

Huawei's headquarters are located in Shenzhen, China. While the company has an estimated 180,000 employees worldwide, it has 60,000 employees at its main campus alone. One of the most unique features: a lake home to three black swans, which represent "non-complacency within the corporate culture."

Source: CNBC

Huawei was founded by Ren Zhengfei in 1987, and he still serves as an executive in the company. Before Huawei, Ren worked as an engineer for China's military, the People's Liberation Army.

Source: Huawei

Huawei smartphones are wildly popular around the world, where they often beat out iPhone sales because they're cheap and powerful.

Source: Business Insider

The company has tried to expand into the U.S. market, but a possible distribution deal with AT&T fell through in January. The company hasn't yet found another carrier wanting to partner, which may be in part because of pressure from U.S. officials who distrust Chinese companies. This has limited Huawei's footprint in America.

Source: Business Insider

U.S. lawmakers have long seen Huawei as a security threat, thanks to the company's ties to the Chinese government. Some have floated the theory that Huawei's phones and electronics are used to spy on U.S. government officials. Huawei has consistently denied these allegations.

Source: Business Insider

U.S. concerns over Huawei go beyond cybersecurity, however. Federal officials have reportedly been investigating the Chinese company since 2016 for allegedly shipping products from the U.S. to Iran — which would be a violation of U.S. trading laws and sanctions.

Source: Reuters

Trade relations between U.S. and China were already on shaky ground before the arrest of Huawei's CFO. The two governments have been locked in a trade war, and both have imposed billions of dollars worth of tariffs on key imports.

Source: Business Insider

This week, Huawei CFO Meng Wanzhou was arrested. She joined Huawei in 1993, where she now serves as the company's chief financial officer and deputy chairwoman of the executive board. She also happens to be the daughter of Huawei's founder.

Source: Huawei

Meng was arrested in Canada at the request of the U.S. Reports say that she was arrested on suspicion of violating U.S. trade sanctions, which would align with the federal investigation into Huawei. U.S. officials are seeking to extradite her.

Source: Business Insider

Meng's arrest is already escalating tensions between the U.S. and China, coming right as leaders on both sides looked like they were going to come to some kind of agreement. This is being taken by experts as a signal of the Trump administration's hard line on trade relations with China.

Source: Business Insider


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