Published: Mon, May 14, 2018
Markets | By Josh Butler

President Trump: US and China Going to Get ZTE Back to Business

President Trump: US and China Going to Get ZTE Back to Business

Analysts are watching to see if Trump's conciliatory stance will help ease the tensions over trade between the United States and China. Trump wrote on Twitter in the first of two tweets about USA trade relations with China.

ZTE has been forced to stop its key operations after Washington last month banned American companies from selling semiconductors and other goods to the Chinese firm.

Locally last week, we also saw ZTE-manufactured handsets and WiFi equipment removed from sale from Telstra stores as a result of the ban. He said the "Commerce Department has been instructed to get it done!" because "too many jobs in China lost".

The US Department of Commerce recently imposed imposed penalties on ZTE after finding it sold kit to Iran and North Korean in contravention of US sanctions and undertakings not to do so.

The US ban followed an edict earlier in the year against Huawei, also a Chinese manufacturer, that caused a carrier sales deal to fall through just as it was set to be announced at CES. The department banned shipments of U.S. technology to ZTE for seven years, saying the company had failed to reprimand employees who violated United States trade controls on Iran and North Korea. The Department of Commerce has not made an official comment as yet, but what might be expected are tighter restrictions on ZTE.

One 2012 congressional report about ZTE and Huawei, another huge Chinese tech company, said the companies "cannot be trusted to be free of foreign state influence and thus pose a security threat to the United States and to our systems". ZTE's Australian web presence is now redirecting its parent Chinese website.

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Separately, lawmakers in the USA have placed ZTE and even larger Chinese telecom companies in the cross hairs over their reputed ties to the Chinese intelligence and military establishment. American companies are estimated to provide 25 percent to 30 percent of components in ZTE's equipment, which includes smartphones and gear to build telecommunications networks.

In April, he said: "For many years, no president wanted to go against China economically, and we're going to do it".

Experts said Trump's policy reversal was unprecedented.

"This is entirely unprecedented", said Doug Jacobson, an export controls and sanctions attorney for Jacobson Burton Kelley who represents suppliers that do business with ZTE.

"There's no legal mechanism for this".

What this actually means remains to be seen. "ZTE made false statements to the U.S. Government when they were originally caught and put on the Entity List, made false statements during the reprieve it was given, and made false statements again during its probation".

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