1 big thing: Trump officially resurrects ZTE


Jan 2015
Left coast
This has been talked about, mainly because of the Republican President's nocturnal emissions. But now it's a done deal.

China's ZTE is alive, escaping what once looked like a death sentence for repeatedly violating U.S. sanctions and being seen as a threat to national security.

The details: The deal requires a $1 billion fine for ZTE, plus $400 million in escrow to cover any future violations. ZTE will also have to "retain a team of special compliance coordinators" who answer to the U.S., and change its top leadership.

The big picture: Trump's broad tariffs against Chinese goods concern Beijing, but the Commerce Department going after ZTE — a state-owned enterprise in a strategic sector — hit a sore spot for the Communist Party.

P.S. "[ZTE's] fate has gotten caught up in a bigger web, including an upcoming summit between President Trump and North Korea’s leader and the success of an American telecom company, Qualcomm, which sells a large amount of semiconductors to ZTE and is awaiting Chinese approval of a deal to acquire a Dutch telecom firm that will help it build the next generation of wireless technology, known as 5G." [N.Y. Times]​

Why it matters: China's successful negotiation to save the company could embolden it to try the same for Huawei, Axios' Erica Pandey emails.

Huawei has been banned from military bases due to national security concerns about espionage. It's back in the headlines this week after it was revealed Huawei accessed Americans' data via Facebook. [Go deeper on Huawei]​

What they're saying:

Marco Rubio: "I assure you with 100% confidence that #ZTE is a much greater national security threat than steel from Argentina or Europe."

Chuck Schumer: "@realDonaldTrump should be aiming his trade fire at China, but instead he inexplicably aims it at allies like Canada, Mexico and Europe."

Sen. John Kennedy: "I’m sure ZTE makes a fine cell phone, but they’re a little too close to the Communist Party of China for my tastes."

Go deeper: The bipartisan blowback​

What's next: A bipartisan hoard of senators have introduced legislation to reverse the ZTE deal.

Be smart: China has the leverage to take on the U.S., and it's smart enough to use it when it matters — as was the case with ZTE.
This is from the Axios PM Newsletter so I can't link it, but links embedded in the story are below.




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Jul 2014
Some common sense in the GOP??

WASHINGTON (Reuters) - Republican and Democratic U.S. senators introduced legislation on Thursday that would roll back an agreement President Donald Trump’s administration announced to ease sanctions on Chinese telecommunications company ZTE Corp.

The Senate measure would restore penalties on ZTE for violating export controls and bar U.S. government agencies from purchasing or leasing equipment or services from ZTE or Huawei Technologies Co Ltd [HWT.UL], another major Chinese firm.

It would also ban the U.S. government from using grants or loans to subsidize Huawei, ZTE or any subsidiaries or affiliates. The legislation has bipartisan support. It was introduced by Senate Democratic Leader Chuck Schumer and fellow Democratic Senator Chris Van Hollen, as well as Republican Senator Tom Cotton, a close Trump ally who has emerged as one of his party’s most influential foreign policy voices.

Co-sponsors include Republican Senators Marco Rubio and Susan Collins, and Democrats Richard Blumenthal and Bill Nelson.

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