The U.S government is allegedly negotiating with China a deal to lift sanctions on ZTE in exchange for the removal of duties on U.S agricultural products
President Donald Trump has justified his decision to help find a solution to help Chinese vendor ZTE get back into business, saying that the equipment maker is a big buyer of American components and services.
“ZTE, the large Chinese phone company, buys a big percentage of individual parts from U.S. companies,” Trump tweeted Monday. “This is also reflective of the larger trade deal we are negotiating with China and my personal relationship with President Xi.”
During the weekend, Trump tweeted that he and Chinese President Xi Jinping were “working together” to give ZTE “a way to get back into business, fast,” saying too many jobs in China were at stake after the U.S. government banned American companies to exports components to ZTE.
Trump also said that he has instructed the U.S Department of Commerce to find a solution to this conflict. Commerce Secretary Wilbur Ross said that he is considering alternative punishments for ZTE. Ross also said the Commerce Department would consider the question of easing ZTE sanctions “very, very promptly.”
However, Trump’s decision to explore a way to allow ZTE get back to business had raised criticism from Republican and Democratic lawmakers.
“The problem with ZTE isn’t jobs and trade. It’s national security and espionage. Any telecom firm in China can be forced to act as tool of Chinese espionage without any court order or any other review process. We are crazy to allow them to operate in U.S. without tighter restrictions,” Republican Senator Marco Rubio tweeted on May 14.
“Why on earth would President Trump promise to help a Chinese telecom company that has flouted U.S. sanctions and whose practices are a risk to our national security?” Democrat Senator Chuck Schumer said.
Negotiations to save ZTE are part of trade negotiations been carried out this week between U.S and Chinese officials. According to reports from Reuters and Dow Jones, U.S. and Chinese negotiators are working on a deal that would reprieve China’s ZTE from sanctions which prohibit U.S. firms from selling components to the company. In exchange, China would remove tariffs on U.S. agriculture products, including soybeans.
Last month, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) banned American companies from selling telecommunications equipment and services to ZTE during a seven-year period after the vendor allegedly did not live up to the terms of an agreement that had been worked out after it illegally shipped telecom equipment to Iran and North Korea.
Last week, ZTE, which currently employs about 75,000 people, said it had ceased its major operating activities due to the export ban imposed by the US government.
