USA will help China's ZTE 'get back into business'
14 May, 2018, 00:30 | Author: Gladys Mathis
Trump said in a tweet Sunday morning that he's working with Chinese leader Xi Jinping and has "instructed" his Commerce Department to get ZTE back in business because "too many jobs in China lost".
The announcement seemed to directly contradict the policy of the Department of Commerce, which in April imposed a seven-year ban on sales of components to ZTE in connection with the company's violation of US sanctions on Iran.
"President Xi of China, and I, are working together to give massive Chinese phone company, ZTE, a way to get back into business, fast".
ZTE, one of the world's largest telecom equipment makers, suspended its main operations after the U.S. Commerce Department banned American supplies to its business.
The company recently said that it would cease "major operating activities" because of the US government's recent trade restrictions.
"The company paid over US$2.3 billion to 211 United States exporters in 2017, a senior ZTE official said".
The U.S. government initially penalized ZTE in 2017, requiring the Chinese telecom giant to pay $1.19 billion to settle charges that it violated U.S. sanctions in selling equipment to Iran and North Korea.
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Trump's reversal could have a significant impact on shares of American optical components makers such as Acacia Communications and Oclaro which saw their stock prices fall when US companies were banned from exporting goods to ZTE.
ZTE recently submitted a request for the U.S. Commerce Department to put the order forbidding American firms from selling parts and providing services to it, on hold.
The Commerce Department ban on US suppliers exporting goods to the Chinese network equipment and handset maker was discussed when a delegation led by US Treasury Secretary Steven Mnuchin met with Chinese officials in Beijing last week.
Against that background, the Trump administration has barred military and government employees from using smartphones from ZTE and fellow Chinese maker Huawei.
A ZTE smart phone is pictured in this illustration.
Digicel made its announcement yesterday after ZTE Corp said on Wednesday that its main business operations had ceased due to the ban imposed by the U.S. government.
For instance, MTN, a South Africa-based wireless carrier with 220 million customers throughout Africa and the Middle East, said the possibility ZTE would collapse forced the carrier to develop contingency plans.
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