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U.S. officials said the Pacific Light Cable Network, a 12,800-kilometre underwater data connection between America and Asia backed by Google and Facebook, should not connect through Hong Kong over concerns that the Chinese government might be able to access “the sensitive personal data of millions of US persons.” (BBC)

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Talking point: Google, Facebook and other parties first proposed the sprawling underseas network of fiber optic cables four years ago. Security concerns around Pacific Light mounted over the last year as U.S. policymakers weighed some of the Chinese partners involved in the project. In April 2019, the U.S. Federal Communications Commission approved Google’s request to connect to Taiwan, but not Hong Kong. The U.S. Justice Department said its data theft concerns have been “heightened” by the Chinese government’s “recent actions to remove Hong Kong’s autonomy,” referring to Beijing’s approval last month of a national security law. The announcement comes as Secretary of State Mike Pompeo is planning to meet with his Chinese counterpart, Yang Jiechi, in Hawaii and the U.S. imposes new export controls on Chinese telecom giant Huawei. Unwillingly caught in the middle of this tech war is Europe: “When two elephants dance, it’s hard to stand aside and not be impacted,” said Jörg Wuttke, the president of the European Chamber of Commerce in China.

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Huawei CFO Meng Wanzhou’s lawyers allege the records the U.S. government filed to back up its request for Canada to extradite her are “replete with intentional or reckless error,” and are asking for a stay of the proceedings. Chinese foreign ministry spokespeople claimed Meng’s detention was politically motivated, citing a CSIS report. (Reuters, CBC, The Globe and Mail)

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Talking point: The CSIS report showed the Canadian government expected a backlash to Meng’s detention, and the foreign ministry’s comments Monday named both Ottawa and Washington in the supposed political conspiracy. The U.S. and China are competing to set international standards in key technology areas like networking and AI. But U.S. firms were reportedly unclear on how much information they could share at 5G rule-setting forums in which Huawei was participating under existing restrictions, limiting their influence. Chinese tech stocks rose on news of the upcoming commerce-department order. Meanwhile, the federal innovation department is reportedly pushing Telus to remove Huawei equipment in its 4G network in Ottawa and Gatineau.

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The legislation, which Prime Minister Boris Johnson could reportedly announce within weeks, would make it mandatory for U.K. firms to report attempted takeovers that could pose risks. (The Times)

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Talking point: The U.K. has made a number of moves in recent months to distance itself from China, including signalling it’ll reduce Huawei’s role in building 5G and offering to accept millions of Hong Kong refugees. This new law is part of a global wave of new protectionist measures. France, Australia, Poland, Hungary, the Czech Republic, Germany, Sweden, India and Canada have all recently introduced measures restricting foreign investment. Canada announced it would keep a particular eye on foreign investment from state-controlled companies, as well as any transactions involving public health or critical goods. Many other nations are introducing new mechanisms from France’s fund that will invest in tech firms to prevent foreign bids to the U.K., threatening directors that fail to report takeovers with jail time.

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On Monday, Beijing paused purchases of some U.S. farm products, including soybeans and pork, but Canadian agricultural imports have not been affected. “I can confirm that no Canadian farm imports have been halted by China,” said Jean-Sébastien Comeau, a spokesperson for Agriculture Minister Marie-Claude Bibeau. (The Logic)

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Talking point: Over the past 18 months, China has halted meat and canola imports from Canada. The reprieve for Canadian imports is the latest sign that China is not yet retaliating as some feared, following last week’s B.C. Supreme Court ruling against Huawei CFO Meng Wanzhou. Two days after the court ruling, China’s foreign ministry spokesman Zhao Lijian, who has previously harshly criticized Canada’s treatment of Meng, spoke instead about the 50th anniversary of diplomatic relations between Canada and China.

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Britain wants to forge an alliance with the “D10” network of like-minded democracies, including Canada, to seek out alternatives to Huawei in building 5G network infrastructure. The move comes as COVID-19 and Beijing’s proposed security law for Hong Kong have strained relations between Britain and China. (The Times, Bloomberg)

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Talking point: Britain’s proposed alliance would likely force Canada to decide on the use of Huawei technology in the country—a decision from which the government has studiously shied away, despite countervailing pressure from the U.S. on one side and China on the other. A recent B.C. Supreme Court decision against Huawei executive Meng Wanzhou has drawn China’s diplomatic ire, with its foreign ministry saying Canada is in cahoots with the U.S. to bring down the company.

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The German car manufacturer will invest €1 billion (US$1.11 billion) and take a 75 per cent stake in JAC Motors by acquiring half its parent firm, state-owned Anhui Jianghuai Automobile Group. It will invest another €1.1 billion in Chinese battery producer Guoxuan High-Tech, representing a 26 per cent stake in the firm. (The Wall Street Journal)

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Talking point: The investment is another endorsement of China’s potential as a massive market for electric vehicles, and signals new competition to electric-vehicle rivals in China. The country is a priority market for Tesla, which began delivering vehicles from its new Shanghai plant in December 2019, while General Motors and Toyota also aim to expand sales in China. The move could also win favour with German Chancellor Angela Merkel, who has cooled on the custom of giving the auto sector preferential relief funding in her strategy to rebuild the economy. Earlier this month, she told car companies they would have to make their case for aid, like any other firm.

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In a joint statement, Foreign Affairs Minister François-Philippe Champagne said the move could undermine the “enhanced trust in governments and international cooperation” required to combat COVID-19. The signatories also claim Beijing is not living up to commitments made when the territory reverted from British colonial rule. (The Logic)

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Talking point: The statement comes the day after a B.C. judge ruled that the extradition trial of Huawei CFO Meng Wanzhou can proceed, a decision that diplomatic and security experts predicted would prompt retribution from the Chinese government. Last week, Prime Minister Justin Trudeau directly accused Beijing of detaining Canadian citizens Michael Spavor and Michael Kovrig as “retaliation” for Meng’s arrest. He also said China does not understand or have an equivalent to Canada’s independent judicial system; Champagne’s statement similarly claimed the national security law’s application to the territory “raises the prospect of prosecution in Hong Kong for political crimes.”

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The territory “does not continue to warrant treatment under United States laws” equivalent to during its time as a British colony before 1997, Secretary of State Mike Pompeo said in a statement. He cited the Chinese government’s move to apply national security legislation to Hong Kong. (The Logic)

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Talking point: Being designated autonomous lets Hong Kong residents and companies conduct business with the U.S. in areas that are forbidden to the rest of China, such as importing high-tech equipment. The territory’s accompanying special-trade status also exempts its exporters from U.S. tariffs on Chinese goods, which the Trump administration spent much of last year raising. U.S. policymakers can now choose to revoke those exceptions or impose new trade and immigration restrictions. China has insisted the security law is an “internal affair,” and that it will “take necessary measures to fight back” against any “foreign interference,” which appears to cover any U.S. criticism or action.

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Since as early as October 2019, Google-owned YouTube has deleted the Chinese versions of the terms “communist bandit” or “50-cent party” left under videos and livestreams on the platform. YouTube said the phrases were inadvertently added to its automated filters, on which the company has relied more frequently during the pandemic. (The Verge)

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Talking point: The Chinese government blocked YouTube in 2009, Google’s search engine in 2010 and virtually all of Google’s services in 2014. In their place, rough equivalents of Google’s products have flourished: Bilibili, a YouTube-like video sharing platform, has 172 million active monthly users. The company has made attempts to regain access to the market, most recently with Project Dragonfly, a search engine that complied with the country’s censorship laws. The company confirmed the end of the project in 2019, in the wake of criticism from the U.S. government and its own employees.

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The U.S. Department of Commerce imposed the sanctions on eight Chinese companies last week, accusing them of complicity in the “human rights violations and abuses in China’s campaign of repression, mass arbitrary detention, forced labor and high-technology surveillance” against members of the country’s Uyghur Muslim minority. China claimed those sanctions “violated basic norms of international relations,” while biometric conglomerate CloudWalk Technology, one of the eight targeted companies, said the sanctions will only hurt U.S. companies. (The Associated Press)

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Talking point: The relations between the two countries, already strained from U.S. constraints on Huawei, plumbed news depths with the sanctions. “It’s time for the United States to give up its wishful thinking of changing China and stopping 1.4 billion people in their historic march toward modernisation,” said Chinese Foreigh Minister Wang Yi, author of the “new Cold War” quip.