Trump to help Chinese telco ZTE 'get back into business' following ban

Trump to help Chinese telco ZTE 'get back into business' following ban

Trump to help Chinese telco ZTE 'get back into business' following ban

Reports suggested that the Chinese government was working on ZTE's half to find a compromise, and it looks like Chinese Premier Xi Jinping himself got in touch with the U.S. President, who said today in a tweet that is he "working... to give..."

The Commerce Department in April cut off the massive Chinese telecom equipment maker from its USA suppliers after determining that the company flouted a 2017 agreement resolving allegations it illegally shipped telecommunications equipment to Iran and North Korea.

The Trump administration punished Chinese tech company ZTE for illegal practices, but on Sunday, President Donald Trump said he's going to work to help ZTE because of "too many jobs in China lost".

ZTE said it is working with the Trump administration to reverse the sanctions and "forge a positive outcome in the development of the matters".

Meanwhile, ZTE, which relies on US firms for key smartphone components, including microchips from Qualcomm and glass from Corning, has said the USA export ban is a massive disruption to its business and ZTE Chairman Yin Yimin called it unfair and unacceptable. In a stark announcement earlier this week, the Chinese telecom giant confirmed it was shutting down "major operating activities".

The company recently said that it would cease "major operating activities" because of the USA government's recent trade restrictions.

While it's not surprising that Trump would announce his support for such a move on Twitter, the fact that he's so forcefully supporting ZTE in the first place raises eyebrows for a number of reasons.

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The month before, ZTE pleaded guilty in federal court to illegally selling and shipping American products to Iran. The person reiterated ZTE's recent point about its cash reserves which allow it to stay afloat over the troubled period, though it's still unclear how large those holdings actually are, i.e. how much time could they buy.

ZTE did not immediately respond to a request for comment.

American technology companies are estimated to provide 25-30 percent of the components used in ZTE's equipment, which includes smartphones and gear to build telecommunications networks for telecom operators globally.

ZTE depended on American chips and other components, and is unable to continue operating without key supplies.

Before the USA components ban, ZTE was providing services for 100 million users in India, 300 million users in Indonesia and 29 million users in Italy, the official told Reuters.

But U.S. officials said this year that ZTE didn't discipline all the employees involved in the violations.

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