US President Donald Trump and his Chinese counterpart Xi Jinping, pictured in Beijing in 2017, agreed to a tariff truce in order to find a permanent solution to the costly dispute

Vancouver (AFP) - Chinese telecom giant Huawei’s chief financial officer was due to appear at a bail hearing Friday following an arrest that has racheted tensions in the US-China trade war.

Meng Wanzhou’s detention in Canada – at the request of the United States – came on the day of a summit at which President Donald Trump and his Chinese counterpart Xi Jinping agreed to a tariff truce in order to find a permanent solution to the costly dispute.

China says Meng – the daughter of Huawei founder Ren Zhengfei, a former engineer in China’s People’s Liberation Army – has violated no laws in Canada or the United States and has demanded her release.

Washington and Beijing have exchanged steep tariffs on more than $300 billion in total two-way trade, locking them in a conflict that has begun to eat into profits.

US Senator Ben Sasse has linked Meng's arrest to US sanctions on Iran

Trump tweeted Friday that negotiations to defuse the high stakes dispute were “going very well” but the messages since Meng’s December 1 arrest have been mixed, roiling global stock markets.

Her appearance at the British Columbia Supreme Court in Vancouver, a prelude to an extradition process that could take months, is subject to a publication ban sought by Meng.

US authorities have not disclosed the charges.

But US Senator Ben Sasse has linked Meng’s arrest to US sanctions on Iran, which Trump is trying to squeeze economically after withdrawing from a denuclearization deal.

- ‘Princess’ of Huawei -

Updated timeline showing how Chinese telecom giant Huawei has been dropped from major markets in the past year.

CNN, quoting an unnamed official, said the United States saw the arrest as providing leverage in US-China trade talks – although White House trade advisor Peter Navarro has denied a link to the dialogue.

On Friday, Beijing nevertheless alleged that Meng, known internally as the “princess” of Huawei and possible heir to the throne, had become a pawn in the dispute.

“The Chinese government should seriously mull over the US tendency to abuse legal procedures to suppress China’s high-tech enterprises,” said the nationalist tabloid Global Times in an editorial.

“Obviously, Washington is resorting to a despicable rogue’s approach as it cannot stop Huawei’s 5G advance in the market,” it went on.

Meng has spent most of the past week at a women’s detention facility in a suburb of Vancouver.

Canadian Prime Minister Justin Trudeau, pictured in 2016, said politics played no part in Meng's arrest

If she is released on bail, she would likely have to surrender her passport and submit to electronic monitoring until she is discharged or surrendered for trial to the United States. All security costs would be borne by her.

The extradition process could take months, even years, if appeals are made in the case. The Vancouver Sun reported on Friday that Meng’s husband Xiaozong Liu is believed to own two mansions in the city.

Canada is one of more than 100 countries that have an extradition treaty with the United States, requiring it to cooperate with US Department of Justice requests to hand over suspects.

- Repeated setbacks -

This longstanding treaty requires that the offence for which extradition is being sought is also a crime in Canada.

A Canadian court must decide if there is sufficient evidence to support the extradition, but then it is left to Canada’s justice minister to sign the order.

Canadian law prohibit handing over suspects if there is a risk of torture or if they could face capital punishment.

On Thursday, Prime Minister Justin Trudeau defended Canada’s arrest of Meng, saying officers who detained her as she was changing planes in Vancouver had acted on their own, and that politics played no part.

“I can assure everyone that we are a country (with) an independent judiciary,” Trudeau told a tech conference in Montreal.

Huawei faces being shut out of Australia, New Zealand and US 5G rollouts

Huawei’s affordable smartphones have made strong inroads in the developing world, but the company has faced repeated setbacks in major Western economies over security concerns.

Earlier this week, Canadian officials said Ottawa was continuing to review Huawei’s technology for use in upcoming fifth generation networks.

The company faces being shut out of Australia, New Zealand and US 5G rollouts, and British telecom group BT revealed on Wednesday it was removing Huawei equipment from its core cellular network.

The five nations together form the “Five Eyes” intelligence alliance.