(Yicai Global) May 14 -- US President Donald Trump has vowed to give ZTE Corp. a “way to get back into business, fast” in a tweet that contrasted with his earlier tone and could be a pivotal point in saving China’s second-biggest telecoms equipment maker, which employs 75,000 people.
“President Xi of China, and I, are working together to give massive Chinese phone company, ZTE, a way to get back into business, fast,” Trump wrote on Twitter yesterday. “Too many jobs in China lost. Commerce Department has been instructed to get it done!"
ZTE shut down operations on May 9 after the US Department of Commerce issued a denial order on April 16 that prevents the company from buying American materials and technologies for seven years. The Shenzhen-based company imports chips and other key components from the States and it quickly ran out of supplies. It suspended share trading the morning after the order’s release.
Trump’s comments come in the buildup to further trade talks between the world’s two largest economies as they look to hold their own in what could turn into a trade war that costs both billions of dollars. Chinese Vice Premier Liu He is set to head to Washington this week to hold talks with US Treasury Secretary Steven Mnuchin.
"China made solemn representations with the US regarding the ZTE case during trade negotiations on May 3 and May 4,” a Chinese commerce ministry spokesperson told the media on the last day of the first round of talks. “The US side said it takes the representations seriously and will relay China’s message to the US president.”
The sanction on ZTE, which includes CNY7.6 billion (USD1.2 billion) in penalties, was dished out after the US claimed ZTE failed to comply with an agreement it made to avoid a similar punishment in 2016 for violating American regulations on selling technology to Iran and North Korea.
ZTE and related parties are actively communicating with the US government to modify or cancel the ban and try to develop the matter in a positive direction, the company said last week. ZTE has sufficient cash and strictly abides by its commercial obligations while complying with laws and regulations, it added.
Editors: Emmi Laine, James Boynton