President Trump has already suggested that there is a deal to be done (surprise surprise) but it looks like its not a very favourable one for ZTE.
The Trump administration’s top trade officials traveled to Beijing for an initial round of trade talks between the USA and China.
From the beginning of Donald Trump’s presidential campaign, he has said he wants to make trade “fair”.
“I can assure you that whatever the Commerce Department decides, the intel community has been part of the briefings and we will ensure that we enforce national security issues”, Mnuchin said.
The United States and China are reportedly nearing an agreement that would reduce the threat of a trade war between the two countries, and the ban against us component sales to China’s ZTE could be lifted as part of that deal.
Of course the concern from the Chinese is that ZTE, a fairly major manufacturer and employer with approximately 75,000 employees is effectively being put out of business, likely leading to Chinese lobbying on behalf of the firms as part of its trade talks with the US. Now a new American bill is being mooted to expand the powers of the Committee on Foreign Investment in the United States (CFIUS) to target Chinese tactics more effectively. “Commerce Department has been instructed to get it done!” He was met with backlash from officials and lawmakers concerned that the administration is softening its stance in trade negotiations with China. Chris Van Hollen, D-Md.
Trump also faced accusations of quid-pro-quo after pledging to soften sanctions on ZTE just days after AFP reported a Chinese state firm would pour cash into a Trump-tied real estate venture in Indonesia. The bill is expected to come to a vote this summer.
Sinopec’s trading arm Unipec has bought 16 million barrels, or about 533,000 barrels per day, of US crude to load in June, they said, the largest volume ever to be lifted in a month by the company and worth about $1.1 billion (£823.6 million). But then lied again instead of discipline gave those employees bonuses. In April, the Commerce Department cut off Chinese telecommunications company ZTE Corp. from its American suppliers in response to what Commerce Secretary Wilbur Ross called “egregious” violations of USA sanctions against doing business in Iran and North Korea. ZTE also agreed to pay a $1.2 billion fine.
In agriculture, China’s state grain stockpiler Sinograin returned this week to the US soybean market for the first time since early April, two sources said.
As it stands, ZTE can not deal with any US-based company. China has been a chronic violator of basic rules of fairness by manipulating their currency, stealing our intellectual property.
Bottom line: The situation remains fluid but the president has paid a political cost for his willingness to spare ZTE. Trump’s economic team hinted at a way forward on the company in television interviews, although the message was muddled.
A source with knowledge of Commerce Secretary Wilbur Ross’s strategic thinking told DailyMail.com on Wednesday that steel, not the global automobile trade, is his focus.
“As day worn on, Trump’s comments about North Korea and not having a deal with ZTE just brought people back from yesterday’s euphoria into more of a reality that this issue with trade is not going to end as quickly as many had thought”, said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in NY.