Trump pledges to help Chinese phone maker that was hurt by sanctions

US Bans American Companies From Selling to China's ZTE

In a stark announcement earlier this week, the Chinese telecom giant confirmed it was shutting down "major operating activities".

FBI Director Chris Wray explained why it is an issue for companies and local governments to use Huawei or ZTE products and services.

At the time, the company said it was still assessing the impact of being placed on the Commerce Department's blacklist.

The company said Sunday it had submitted a request to the United States commerce department for a stay of the export ban, along with supplemental information.

The US sanctions were the result of an investigation into alleged sales to North Korea and Iran that violated existing US sanctions against those countries.

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As one of the world's largest telecom equipment makers, ZTE relied on USA companies such as Qualcomm and Intel for components.

Trump, who has taken a hard line on trade and technology issues with Beijing, tweeted on Sunday that he and Chinese leader Xi Jinping "are working together to give massive Chinese phone company, ZTE, a way to get back into business, fast". The order was causing "irreparable harm" to the company and partners, as well as millions of consumers, including those who own its phones and major network operators, the person said.

American technology companies are estimated to provide 25-30 percent of the components used in ZTE's equipment, which includes smartphones and gear to build telecommunications networks for telecom operators globally. A host of big technology companies in China are racing to build out this network, sparking concerns from USA officials that a shifting reliance on technology developed outside of the US could empower Beijing to hack or spy on American businesses and other institutions.

ZTE relies on U.S. companies such as Qualcomm and Intel.

None of the other companies could immediately be reached for comment.

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ZTE's troubles with the USA government are also playing out amid broader fears of an ascendant Chinese tech industry.

But U.S. officials said this year that ZTE didn't discipline all the employees involved in the violations. The company's R&D expenditure previous year stood at 12.96 billion yuan, which accounted for about 11.9 percent of the company's operating revenue.

"ZTE made false statements to the U.S. Government when they were originally caught and put on the Entity List, made false statements during the reprieve it was given, and made false statements again during its probation".

Chinese Vice Premier Liu He is expected to resume trade talks with the Trump administration this week, after discussions in Beijing last week yielded no agreement on a long list of USA trade demands.

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