Trump's trade team spent days building a strategy to deal with the Huawei CFO arrest. Then Trump blew it up in a single interview.

  • Trump administration officials have been trying to treat the arrest of Huawei CFO Meng Wanzhou and the US-China trade talks as two separate issues.
  • Trump undermined that argument on Tuesday by suggesting Meng could be used as a bargaining chip in the trade talks.
  • "I would certainly intervene if I thought it was necessary," Trump told Reuters.

President Donald Trump has once again created a potential headache for his economic team in talks with China and thrown a wrench into a days-long effort to keep negotiations on track.

Trump's economic team has taken pains since Canada's arrest of Chinese tech giant Huawei's CFO, Meng Wanzhou, to separate the issue from the ongoing trade negotiations. But Trump contradicted those efforts during an interview with Reuters on Tuesday.

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Huawei CFO Meng Wanzhou arrested in Canada
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Huawei CFO Meng Wanzhou arrested in Canada
Huawei chief financial officer Meng Wanzhou arrives at a parole office in Vancouver, British Columbia, Wednesday, Dec. 12, 2018. (Darryl Dyck/The Canadian Press via AP)
Huawei chief financial officer Meng Wanzhou arrives at a parole office with a security guard in Vancouver, British Columbia, Wednesday, Dec. 12, 2018. (Darryl Dyck/The Canadian Press via AP)
Huawei chief financial officer Meng Wanzhou, left, leaves her home in Vancouver, British Columbia, Wednesday, Dec. 12, 2018. (Jonathan Hayward/The Canadian Press via AP)
Huawei chief financial officer Meng Wanzhou, left, leaves her home with a security guard in Vancouver, British Columbia, Wednesday, Dec. 12, 2018. (Jonathan Hayward/The Canadian Press via AP)
Huawei chief financial officer Meng Wanzhou, right, waves goodbye to visitors at her home in Vancouver on Wednesday, Dec. 12, 2018. A Canadian court on Tuesday released Meng on bail, confining her to Vancouver and its suburbs while she awaits possible extradition to the United States. The U.S. has accused Huawei, the biggest global supplier of network gear for phone and internet companies, of using a shell company to do business with Iran in violation of U.S. sanctions. (Jonathan Hayward/The Canadian Press via AP)
Supporters hold signs and Chinese flags outside British Columbia Supreme Court during the third day of a bail hearing for Meng Wanzhou, the chief financial officer of Huawei Technologies, in Vancouver, on Tuesday December 11, 2018. (Darryl Dyck/The Canadian Press via AP)
In this courtroom sketch, Meng Wanzhou, left, the chief financial officer of Huawei Technologies, speaks to her lawyer David Martin during a bail hearing at British Columbia Supreme Court in Vancouver, British Columbia, Monday, Dec. 10, 2018. (Jane Wolsak/The Canadian Press via AP)
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"If I think it’s good for what will be certainly the largest trade deal ever made — which is a very important thing — what’s good for national security — I would certainly intervene if I thought it was necessary," Trump said.

The statement flies in the face of comments from National Economic Council Director Larry Kudlow and US Trade Representative Robert Lighthizer, the leader of negotiations with Beijing.

"This is a criminal justice matter. It is totally separate from anything that I work on or anything that the trade policy people in the administration work on," Lighthizer told CBS' "Face the Nation" on Sunday. "So, for us, it's unrelated, it's criminal justice."

Kudlow offered a similar assessment during an interview on "Fox News Sunday."

"I might be wrong," he said. "I can't predict the future on this thing, but there are different channels and I think they will be viewed that way for quite some time."

Chinese officials have also attempted to keep the two issues separate, instead directing most of their ire at Canada since the arrest.

By quarantining Meng's arrest from the trade negotiations, the Trump team was hoping to achieve some success on trade while continuing a broader effort to address China's growing influence in technology and geopolitics. But with Trump mixing the two issues, advisers may find it harder to set the broader campaign aside in the trade talks.

Additionally, some analysts and observers have argued that Trump using a national security and justice issue as a bargaining chip in trade negotiations would undermine the US's justice system and rule of law

Canadian Prime Minister Justin Trudeau made reference to these fears when asked about Trump's comments on Wednesday.

"Regardless of what goes on in other countries, Canada is, and will always remain, a country of the rule of law," Trudeau told reporters.

Chrystia Freeland, Canada's minister of foreign affairs, pushed back even harder on Trump's comments.

"Our extradition partners should not seek to politicize the extradition process or use it for ends other than be pursuit of justice," she said

US Commerce Secretary Wilbur Ross attempted some damage control Wednesday, telling reporters at the White House that the president had not made a decision.

"Let's see what he actually decides," Ross said Wednesday. "Let's see where we go from there. This is a matter that’s in litigation right now."

Meng was arrested in Canada on December 1 and charged with violating US sanctions on Iran. According to prosecutors at Meg's bail hearing, Huawei misled investors and others about connections to a second company that was still making sales to Iran.

A Canadian judge ordered Meng released on bail Tuesday but with tight restrictions, including ankle monitoring. The Huawei executive's extradition to the US is expected to take months.

The arrest came the same day that Trump and Chinese President Xi Jinping had dinner at the G20 summit in Buenos Aires, Argentina, and hashed out a preliminary trade agreement.

As part of the agreement, Trump delayed the escalation of tariffs on Chinese goods for 90 days while Xi agreed to increase purchases of US goods. The two sides also committed to working on a broader, more detailed trade agreement that addressed underlying Chinese economic practices like the theft of US intellectual property.

The agreement was the first concrete step toward ending the US-China trade war. Roughly $360 billion worth of goods moving between the two countries are now subject to new tariffs imposed over the past six months.

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