In addition to the fine, he envisions new management, a new board of directors, and requirements for significant purchases of U.S. products, he said.
The Commerce Department blacklisted ZTE, the second-largest manufacturer of cellphones in China, from doing business with the USA because the firm failed to comply with a settlement reached after it violated sanctions against North Korea and Iran.
ZTE, which is publicly traded but whose largest shareholder is a Chinese state-owned enterprise, had been hit with penalties for breaking a 2017 agreement after it was caught illegally shipping US goods to Iran and North Korea, in an investigation dating to the Obama administration. United States farmers have much to lose from a potential Chinese trade war, and stepped-up Chinese purchases of American soybeans and other commodities could be a boon.
Beijing had been pressing Washington to lift the ban, and President Trump said last week he was willing to help ZTE get back into business.
Trump’s comments came two days after Treasury Secretary Steve Mnuchin said the United States and China had agreed to a “framework” for a trade deal and were “putting the trade war on hold”.
U.S. President Donald Trump has adopted a more conciliatory stance in the trade dispute with China as North Korea, whose chief ally is Beijing, has called into question a summit planned for next month in Singapore with Trump.
Reports of a compromise on ZTE sparked an immediate negative reaction on Capitol Hill, where top Republican and Democrat senators denounced it and one vowed to block it.
“And when I’m thinking about trade – you know, I read you folks and you say, “Well, why does he” – there’s a much bigger picture that I have in mind”, Trump said. “The leak of the $200b before discussion on counterbalancing USA commitments could advance sufficiently left Chinese negotiators exposed”.
Ross seemed surprised last week at Trump’s demand to reopen a case settled only weeks earlier, and resistant to treat ZTE’s fate as a bargaining chip on trade rather than a straightforward enforcement matter.
After three days of talks, the Trump administration said it was holding off on imposing new tariffs on China.
“Fidelity to the rule of law is a key part of what distinguishes the USA from a country like China that is ruled by a Communist dictatorship”. China is now committed to buy more USA agricultural and energy products aimed at reducing the yawning trade deficit between them.
“This was not a quid-pro-quo or anything else”, said Mnuchin testifying before the Senate Appropriations Committee on the agency’s budget request.
“Both parties have come together today to strongly rebuke ZTE and the administration’s soft approach”, Senate Minority Leader Chuck Schumer said in a statement. The bill passed the panel 25-0 and now advances to the full Senate for a vote.
Congress last year passed a law that required the administration to impose new sanctions on Russian Federation, though similar action this year could be more hard as the November elections draw near. After pretty clearly violating United States trade restrictions with Iran, ZTE was heavily sanctioned earlier this year, which didn’t make China happy, either. But we were the ones that closed it.
“I think that they’re a start, but we need something”, he said. China responded aggressively with tariffs of its own and now POTUS is in a bind, not wanting to cave and look weak but also knowing that digging in really could risk a full-blown trade war and ruin the chances of dialogue with North Korea.
That statement, and reports that the administration had discussed easing the penalties during a visit by Chinese trade negotiators last week, have sparked a backlash from lawmakers across the political spectrum. We lose. And so we’re looking to go quickly’.
Ilan Goldenberg, the director of the Middle East Security Program at the Center for a New American Security, also took the Trump team to task over the negotiations.