Published: Fri, April 27, 2018
Hi-Tech | By Preston Stone

After ban, ZTE promises to protect staff and clients' interests

After ban, ZTE promises to protect staff and clients' interests

It said the probe of Huawei is similar to one that China's ZTE Corp. says is now threatening its survival.

The cases come as the United States and China are gearing up for a potential trade war, with the high-tech sector among the concerns for both sides.

After the imposition of the seven-year ban, billions in ZTE's market capitalisation in the U.S. were wiped out.

In 2017, ZTE posted revenues of CNY108.8 billion (US$17.27 billion), surging 7.5% on year.

The DOJ's actions follow a larger pattern of the USA increasingly cracking down on Chinese firms.

It's somewhat uncertain as to whether Huawei has actually supplied anything to Iran.

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ZTE, which sells smartphones in the United States, paid $890 million in fines and penalties, with an additional penalty of $300 million that could be imposed. "There was no discussion of helping ZTE advocate before the US government".

In the B2B sales sector, ZTE has zeroed in on transportation, energy, finance, enterprises and education segments for priority promotion of its communication products and technologies, which mainly include virtualized datacenters, distributed databases and big data analysis. Within ZTE, compliance is regarded as the foundation and bottom-line of the Company's operation. SASAC went on to add that not only do the actions (and sometimesinaction) taken by ZTE harm its own business operations, but also suppliers and other companies that it depends on.

ZTE will definitely be hit hard, but it won't be alone.

Trade tensions between the U.S. and China have been escalating ever since President Trump initiated protectionist policies against Asian superpower. China now still relies on foreign makers for the supply of over 90% domestic chip demand, and can hardly see a clear future for its semiconductor industry despite aggressive deployments in wafer foundry, IC design and memory production.

Huawei Technologies, China's largest telecommunications equipment and smartphone maker, has tried for many years to break into the USA market, to little avail. That last part is significant, as ZTE is a customer of several US-based companies, including Qualcomm. The company is supposedly being investigated by the Department of Justice for violating sanctions against Iran; something that could lead to severe penalties and a possible ban.

The Trump administration also has cited Huawei, the world's largest maker of cellular-tower electronics and other telecommunications equipment, as a threat to American leadership in the race to develop the future of mobile communication.

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