> Its executive chose to travel to Canada.

In retrospect, that was foolish.

No Canada is arresting on behalf of US. On the contrary, Huawei is building 5g infra for Canada.

> Violating sanctions is a criminal offense under U.S. and Canadian law.

Just because its legal does not mean there wont be an aggressive reaction[1]. China will probably respond with force. Huawei with market exit. Then there are other actors who would respond in there own way we would never know about. US probably going to take net-hurt from this.

Do you want to hurt US market/USD ? Because thats what use of your justifications will do.

[1] edit: By that I mean non-US actors have not agreed to react aggressively. Legal implies that only US persons have.

> Do you want to hurt US market/USD ? Because thats what use of your justifications will do.

That's not going to happen. China is also not going to over-react. They're going to under-react, because their economy and global political context is at a slightly precarious point. It's why the US has been able to apply such immense tariffs without China doing anything crazy so far: they still need the US more than the US needs China (which isn't the same thing as the US not needing China at all). It's also partially why China is relatively eager to find positive ground with the US on trade issues. For example the US is currently building a coalition to reform the WTO in a manner that is detrimental to China (it caused the recent surge in Chinese interest in settling the trade dispute). The US is running perpetual trade deficits with almost everyone (specifically of importance, the major economies), which leaves most everyone having more of an interest in going along with the US rather than China on trade modifications. To say nothing of the IP issues and market barriers in place in China.

China will find a modest way to stab the US over this, unless it's resolved relatively quickly. It won't be a big deal for China, arresting one executive is not something they'll care to shake the world over at all. This isn't Jack Ma we're talking about, which would demand a big response due to his prominence and popularity. This is a nation run tightly by a Communist party that at the highest levels (ie Xi) barely likes business executives to begin with, they merely tolerate them as useful tools to get from here to there in a process that China perceives itself as going through. Executives of that sort are pawns that can be thrown away or swapped out with little concern. Overall it may be nothing more than the US acquiring a small bargaining chip at a tiny cost, which it can then release to perceived good will when it does so. It's a relatively simple political move if that's the case.

Its not just US vs China. Its US vs Market. Its the hand of market that US need to watch out for. Everytime a powerful entity acts like a madman, it gets weaker. Soon or later it will receive 1000th cut which may be one too many.

Today US became less reliable.

You're exaggerating what this tiny incident means to the market. Historically this doesn't show up on the list at all, it's just barely a one day top 10 business story.

The market in this context effectively means the top 30 or 40 economies. They make up the extreme majority of all global GDP.

What practical alternative to the US as an essential ally in the coming global bifurcation with China and Russia do you perceive that: EU, Japan, South Korea, Australia, New Zealand, Canada, Mexico, UK, etc - have? Who else is there? There is nobody else to help offset the enormity of China's looming power. The US has, on many occasions since WW2, done radically worse than arrest a Huawei executive over sanctions on a foreign nation. Mr. Market barely blinked over Snowden and the global espionage revelations for example, which was a thousand times worse than this incident. It had enormous commerce implications. For the most part the world went on with its business; and here we are years later, the US espionage system continues unabated (actually it's stronger now) and mostly unchallenged. This arrest will barely matter at all to Mr. Market.

You have very restricted definition of market. Market != Stock Market. Slap of market does not mean you go down, it means the profits goes to your compititors. Rise of China is textbook example here. China made the bank, while everyone who did not have compititive labor regulations got slapped for it. Globalisation basically means States getting slapped for not being competitive.

There are whole categories of companies/products (OVH/ProtonMail/etc) due to NSA. So yes USA got slapped for it too just not as visible as Rise-of-China.

> Do you want to hurt US market/USD ? Because thats what use of your justifications will do.

I would think that human rights, morals, and ideals of liberty and freedom are more important than a few percentages of GDP growth.

Why, yes, I'd rather we didn't do business with a country that has close to 1M people in forced reeducation camps. I am OK with not profiting from some things. A dystopian "social credit" police state, for example, is apparently very high on my list of places not to invest in, be associated with, or deal with at all.

Now thats a moral argument. In a realpolitikal world, X aggresses against Y because its in X's self interest, not because Y have been bad. Under this model, China _is_ suffering from aggressions just not from Apple/etc.

The US and China should behave morally. I disagree with the real politks strategy. I'm sure many countries want to behave that way, I'm glad there is still the rule of law in the US (even as our president tries to subvert it). The US doesn't always act morally, but often it does - our laws against us companies bribing people in other countries are a good thing even though it makes it harder for us companies to operate in other places.

I'm not naive enough to think that China will suddenly reform itself, end oppression against it's people and take complete advantage of its people's incredible energy, creativity and intelligence.