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China's ambassador to Canada Lu Shaye holds a press conference in Ottawa on Jan. 17, 2019.Blair Gable

China will retaliate if Ottawa bans Huawei Technologies from supplying gear for its next-generation 5G mobile networks over espionage concerns, the country’s envoy said on Thursday, as he called the arrest of a company executive a “backstabbing" betrayal of Canada’s relationship with China.

At a news conference at China’s embassy in Ottawa, ambassador Lu Shaye also warned Foreign Affairs Minister Chrystia Freeland against trying to rally international support at next week’s World Economic Forum in Davos, Switzerland, for three Canadian detainees in China.

The United States is pressing its allies, including Canada, to ban the giant Chinese smartphone and telecommunications equipment maker from the infrastructure of future wireless networks – the Trudeau cabinet is awaiting the conclusion of a national security review before deciding.

Germany says it is also considering whether to exclude Huawei from its 5G networks, a U-turn for Berlin, which had been skeptical of U.S. cybersecurity concerns about the Chinese telecom.

Mr. Lu warned Canadians would suffer consequences if this country also shut the door to the largest private company in China.

“I hope Canadian officials and relevant authorities and bodies will make a wise decision on this issue. But if the Canadian government does ban Huawei from participating in the 5G networks … I believe there will be repercussions,” Mr. Lu said.

He would not elaborate on what kind of repercussions Canada might expect, but Beijing arrested two Canadians on national security grounds and imposed a death sentence on a third for drug smuggling in what appears to be retaliation for the Dec. 1 arrest of Huawei chief financial officer Meng Wanzhou in Vancouver.

As the Western clampdown on Huawei grows, the University of Oxford announced on Thursday it has stopped accepting funding from the Shenzhen-based company amid scrutiny of its relationship with China’s government.

Huawei also has a presence in Canadian universities, but Ottawa has not limited that.

An investigation by The Globe and Mail last year revealed Huawei has a vast network of relationships with leading research-heavy universities in Canada to create intellectual property the company is using to buttress its market position in 5G technology.

The Globe reported in December that Canada’s spy agency warned the country’s top universities to be cautious about their extensive research relationships with Huawei. Officials of the Canadian Security Intelligence Service (CSIS), including assistant director of intelligence Michael Peirce, delivered the warning to research vice-presidents from the U15, a group of research-intensive universities, in Ottawa on Oct. 4.

Ms. Freeland would not say on Thursday when Ottawa will decide whether to ban Huawei.

“When it comes to the 5G decision, as I think Canadians know, that is something which is being studied carefully by our security officials and by the government and is under serious consideration,” she told reporters at cabinet retreat in Sherbrooke, Que.

Most of Canada’s Five Eyes intelligence-sharing allies – the United States, Australia and New Zealand – have barred Huawei from 5G, as have Japan and South Korea. Britain, which is part of the Five Eyes, is debating whether to join the ban.

A German government security official told The Wall Street Journal that Berlin is conducting an interdepartmental analysis of how it can amend the security requirements in a way that would affect Huawei. “There are serious concerns about the building of a 5G infrastructure, including warnings about back doors in hardware components, data flows … this would affect everything from communication to self-driving cars,” the official said.

Washington has warned its allies that the Chinese government can use Huawei’s technology for spying or cyberattacks.

At his Ottawa news conference, Mr. Lu echoed recent comments from Huawei founder Ren Zhengfei urging Western countries to prove the company is being used for espionage.

“The Five Eyes alliance countries have been saying that Huawei poses a national security threat to these countries, but they have never shown any evidence,” Mr. Lu said.

Former CSIS director Ward Elcock said the Chinese ambassador’s threat against Canada demonstrates why Western countries are nervous about the presence of Huawei equipment in their networks.

Mr. Elcock said security experts worry the Communist Party-led government would ask Huawei to incorporate back doors into its equipment for spying or sabotage. A Chinese law approved in 2017 requires companies to “support, co-operate with, and collaborate in national intelligence work.”

“Huawei is not the risk. China is the risk,” Mr. Elcock said. “It’s not as if Huawei can do whatever it wants, that it can tell the Chinese government to take a running leap.”

Mr. Elcock said Canadians should consider what might happen if the United States no longer trusted the security of Canada’s telecommunication infrastructure.

Mr. Lu held his news conference to advance his argument that Ms. Meng, who is Mr. Ren’s daughter, was unjustly detained by Canada at the request of U.S. authorities. The United States wants her extradited on allegations of bank fraud related to violation of U.S. sanctions against Iran.

“In China, we have a saying that a good friend would die for his friend, would shield the knife attack of a friend, but in this case, we feel it is completely the opposite," Mr. Lu said. “It is backstabbing.”

Ms. Meng is free on $10-million bail and living in a $5-million mansion in Vancouver while former Canadian diplomat Michael Kovrig and entrepreneur Michael Spavor are in Chinese jails without regular access to consular services. Canadian Robert Schellenberg had been sentenced to 15 years in prison for drug smuggling, but a Chinese court ruled on Monday on appeal that he should face the death penalty.

Prime Minister Justin Trudeau and Ms. Freeland have been lobbying world leaders to press China to release Mr. Kovrig and Mr. Spavor and to grant clemency to Mr. Schellenberg.

Ms. Freeland and other cabinet ministers plan to raise the plight of the three Canadians in Davos.

But the Chinese envoy said Beijing will not be persuaded.

“This would really escalate tensions instead of easing them,” Mr. Lu said. “Davos is for economic issues and we hope other issues will not be taken. ... We hope Canada thinks twice before making any actions."

Ms. Freeland told reporters she will continue to urge other countries to speak against China’s treatment of the three Canadians and pointed out that Spain is the latest country to support Canada with a public statement. Other countries that have spoken in favour of Canada include Australia, the European Union, France, Germany, the United States, Britain, the Netherlands, Latvia, Lithuania and Estonia.

“There is a large and growing group of allies who share Canada’s concerns about the rule of law, and we are grateful to our allies who are speaking out. We think it is very much in their interests to do so,” she said. “We also very much recognize that our relationship with China is one of very long standing. It is a broad relationship and it is a deep relationship and it is a relationship which we very much believe will and should continue.”

Roland Paris, a University of Ottawa professor and former foreign policy adviser to Mr. Trudeau, said it is “entirely appropriate and sensible” for Ms. Freeland to seek support from other countries for the Canadians.

“All liberal democracies should be concerned about the way China has treated these Canadian detainees and we should all be standing together,” Prof. Paris said.

With a report from Reuters

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