US president Donald Trump Let ZTE reopen in Exchange of Fine and Security Guarantees. The Chinese vendor has to pay a $1.3 billion fine, agree to purchase US equipment and overhaul its management team. Last month, the Department of Commerce (DoC) had imposed a ban on ZTE. The ban was imposed because the Chinese company apparently failed to adhere to the terms of a March 2017 settlement in a case relating to violations of trade sanctions covering Iran.
Trump Let ZTE reopen in Exchange of Fine and Security Guarantees
On Twitter, Trump has announced the reopening of the ZTE and also used the opportunity to take a swipe at the previous administration, arguing that Obama’s team had “let ZTE flourish with no security checks.”
Senator Schumer and Obama Administration let phone company ZTE flourish with no security checks. I closed it down then let it reopen with high level security guarantees, change of management and board, must purchase U.S. parts and pay a $1.3 Billion fine. Dems do nothing….
— Donald J. Trump (@realDonaldTrump) May 25, 2018
ZTE, China’s second largest telecom company is currently on life support. Without crucial hardware components, ZTE’s factories and most of its 75,000 employees are sitting idle. The ban stops U.S. companies like Google, Qualcomm, and Intel from doing any kind of business with ZTE. By some estimates, ZTE uses components from American suppliers is up to 90 percent of its products.
According to the new deal, ZTE would also have to purchase a majority of its components from U.S. companies. According to Bloomberg, ZTE would also have to give American “compliance officers” access to its operations.