Published: Mon, May 14, 2018
Money | By Ethel Goodwin

USA and Chinese presidents work to get ZTE 'back into business'

USA and Chinese presidents work to get ZTE 'back into business'

Mr Trump has insisted that relations between Washington and Beijing have never been better and he has been working closely with Mr Xi in efforts to persuade North Korea to abandon its nuclear programme.

The United States and China will be able to reach an agreement in the sphere of trade that would benefit both countries, said the President of the United States Donald trump.

The US Department of Commerce issued the trade ban following its determination of a violation of terms ZTE had agreed to after it was found selling embargoed technology to Iran in 2012.

ZTE, which sells telcom network equipment and consumer devices including smartphones, said on Wednesday that it would cease its main business operations after the U.S. Department of Commerce announced a seven-year export restriction for the company, resulting in a ban on U.S. component makers selling to ZTE.

The US accused ZTE of misleading American regulators after it settled charges of violating sanctions against North Korea and Iran.

Trump's offer for aid comes at a moment of sky-high trade tensions between the United States and China.

For critics worrying about a trade war between Washington and Beijing, the president added a bit of advice - "But be cool, it will all work out!"

But ZTE still relies on U.S. companies to supply it with components for its networking gear.

Trump expects Commerce Secretary Wilbur Ross "to exercise his independent judgment, consistent with applicable laws and regulations, to resolve the regulatory action involving ZTE based on its facts", Walters said.

President Trump takes part in a welcoming ceremony with China's President Xi Jinping in Beijing.

ZTE's current struggles have made it the most visible outcome thus far of a brewing trade war between the United States and China. Trump said in his tweet that he told the Commerce Department to help ZTE.

Experts said Trump's policy reversal was unprecedented. The U.S. officials had brought a list of demands for the Chinese government that included a halt to all subsidies to advanced manufacturing industries. ZTE has denied the charges, but the accusation nevertheless led to some major carriers dropping the manufacturer (Chinese company Huawei has been hit with similar claims too).

Trump's announcement drew sharp criticism from a Democratic lawmaker, who said the move was jeopardizing US national security.

"Our intelligence agencies have warned that ZTE technology and phones pose a major cyber security threat", said Adam Schiff, who is the senior opposition Democratic Congressman on the House Intelligence Committee.

ZTE confirmed last week that it has essentially shut down in the wake of the ban, pausing production lines and suspending business travel as it seeks legal remedies to get the trade ban overturned.

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