China and US Outline an Agreement to Bring Back ZTE To Business
ZTE About To Get Back To Normal Business
Last month on April 16th, the US Government banned ZTE from buying components and technology from American tech companies, for 7 years. ZTE had violated sanctions by illegally shipping products to Iran and other embargoed countries. The Chinese tech company had lied and covered evidence from 2010 up to 2016, according to Wall Street Journal. It was ordered to pay more than $1 Billion as a fine to settle the issue. The company also pledged to take a disciplinary action against its management and board members, which it failed and instead rewarded them with a bonus!
ZTE Company manufactures phones and other products and sells them all over the planet, including the United States. US restrictions on the company from selling telecommunications on its boundaries was a huge slap on the face of the Chinese Company. It has put ZTE on a bad shape in a span of a few weeks that the ban has been effective. The US got worried that the equipment from ZTE may be used to spy on Americans because their products can be hacked by the Chinese. In fact, Pentagon recently pulled out ZTE phones from US military bases.
Wall Street Journalist Shelby Hollidays claimed that ZTE, backed by China government, is aiming to develop 5G technology and so the US views China as a crucial competitor in this area. She goes further to say the Chinese giant tech together with its national government has put plenty of American companies out of business and they are doing it to bring down the US geopolitically, economically and tamper with their national security.
Trade tensions between the two Superpowers are showing every sign to ease as negotiations are now taking a more positive path. President Trump in a tweet said the US trade with China is moving along nicely but claims that in the end, they will have to change structures in the outline citing that it will be too hard to get done and verify results after completion. An official in Beijing, after a regular Foreign Ministry briefing, said the joint US-China statement on economic and trade consultations issued at the weekend had covered the matter.
The deal would include major changes to ZTE board, management and potentially significant fines. Trump wanted China in return to buy massive amount of American agricultural products besides reducing trade barriers and tariffs. It is a deal that both parties are working on a win-win situation. China on Saturday agreed to reduce America’s trade substantially without disclosing the real figure.