It’s been a rough couple of months for ZTE, as the after-effects of a US export ban have resulted in the company effectively. Now, President Trump, in a much-unpredicted move, says he’s working to put the company back in business.
ZTE (ZTCOF), a smartphone and telecom equipment maker, announced last week that it has halted its main operations after the Trump administration has prohibited American companies from selling it vital components. That includes the Snapdragon processors in the company’s smartphones, and even potentially Android itself. Obviously a really tough situation for the company.
Trump says that he’s working with President Xi Jinping of China to get the company back on its form. Jobs in China are at risk, he said. “Too many jobs in China lost. Commerce Department has been instructed to get it done!” – Trump’s tweet on Sunday.
China and the United States are working well together on trade, but past negotiations have been so one sided in favor of China, for so many years, that it is hard for them to make a deal that benefits both countries. But be cool, it will all work out!
— Donald J. Trump (@realDonaldTrump) May 13, 2018
The Chinese government welcomed Trump’s comments. “We very much appreciate the positive statement from the US side on ZTE and maintain close communication with them on the issue,” Foreign Ministry spokesman Lu Kang alleged Monday.
The Chinese corporation employs about 75,000 people. It’s also the fourth largest supplier of smartphones in the United States. Last month, the Trump administration jammed American firms from selling parts or providing services to ZTE until 2025. The ban was set after Washington said ZTE violated a deal struck last year in which ZTE settled to pay a $1.2 billion fine for violating US sanctions on Iran and North Korea.
Trump has continually blasted China for what he calls inequitable trade practices and an alarming trade war between the United States and China has been punctuated by both nations threatening billions of dollars worth of tariffs against the other. And on Sunday, Trump appeared to ease the rhetoric, it’s largely unclear what that means, but it could end with the export ban being loosened to some extent.