President Will Help China's ZTE "Get Back into Business"

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President Will Help China's ZTE

The ZTE shutdown highlights the global ramifications of Trump's trade battle with China.

It's not exactly clear how Trump plans to help ZTE or what he's instructed the Commerce Department to do.

Trump said in a Sunday morning tweet, posted minutes after arriving at his golf course in Virginia, that he and Chinese leader Xi Jinping are working together to give ZTE "a way to get back into business, fast".

In addition, the Defense Department calls ZTE phones a "security risk" to USA service members, and banned the company's phones from sale in any retail outlet on a military base.

"ZTE misled the Department of Commerce", Mr Ross said. The Defense Department in April ordered military exchanges to cease selling ZTE phones on US bases.

And all that, Gold said, "will be face saving for President Trump, who will declare a great victory".

The US action could be devastating to ZTE.

USA officials are preparing for talks in Washington with China's top trade official Liu He to resolve an escalating trade dispute.

ZTE is one of the world's biggest telecommunications equipment makers.

Representatives from both the US and China - which boast the world's largest economies, with nominal GDPs of almost $19.4 trillion and approximately $12 trillion, respectively - held trade talks in early May.

"China and the USA cooperate in the field of trade, but the talks of past administrations for many years has been one-sided in favor of China".

"But be cool, it will all work out!" he added.

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

ZTE has since stated the USA ban was "unfair" and planned to appeal the decision. However, earlier this year the Commerce Department claimed ZTE had not yet disciplined the 35 other employees, so it put a seven year ban on the company, preventing it from using any hardware or software products based in the US.

United States officials imposed the ban last month, saying ZTE failed to abide by an agreement to stop selling to Iran and North Korea.

In response, ZTE said in a statement that "t$3 he Denial Order will not only severely impact the survival and development of ZTE, but will also cause damages to all partners of ZTE including a large number of USA companies".

While the United States and China have threatened each other with trade tariffs, Trump has insisted that relations between Washington and Beijing have never been better and he has been working closely with Xi in efforts to persuade North Korea to abandon its nuclear program. "They are not simply going to be able to resume business as usual", he said. "China may now have strengthened its desire to get out from a under a scenario where the United States can do that again". The company said it is working to have the ban modified or reversed.

"This is a fascinating development in a highly unusual case that has gone from a sanctions and export control case to a geopolitical one", Douglas Jacobson told Reuters.

The company was slapped with sanctions by the U.S.

"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 suppliers including Acacia, Oclaro, Lumentum Holdings, Finisar, Inphi and Fabrinet, all fell sharply after the ban was announced.

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