Donald Trump has vowed to directly intervene in US-China trade to benefit Chinese phone manufacturer ZTE. ZTE is currently banned from selling US technology after it violated sanctions on selling US-made gear to Iran and North Korea and lied to investigators looking into the issue.
ZTE is one of several large Chinese manufacturers of mobile technology. Over the last three years, the company managed to do something that few other Chinese companies have done—leave their home market and make significant inroads in the United States and Japan. Other Chinese brands, like Vivo, show big numbers on the worldwide sales charts, but that’s pretty much all domestic sales within China.
But ZTE’s global outreach also included sales to Iran and North Korea. Since at least 2011, the US has been looking into ZTE’s sales to Iran, which included US-made technology used in surveillance gear. Not only did investigations show that ZTE had made such sales, it also turned up the sales of US-made equipment to North Korea. And ZTE both lied to the Department of Commerce about it’s actions and actively tried to interfere in the investigation.
Ultimately, ZTE was given a record $1.2 billion fine for its actions. It also agreed to take internal action at the company to penalize those officers and workers who had knowingly worked to defy the sanctions and make other moves to safeguard against such an event happening again. It didn’t. So earlier this year, the United States banned sales of US hardware and software components to ZTE.
In response, ZTE warned that the company could no longer operate. Even the phones it sells inside China depend on Google’s Android operating system and use chips designed by California-based Qualcomm. ZTE protested the ban, but the Commerce Department made it clear that ZTE’s violations were blatant and the ban would not be lifted.
But now, Donald Trump is coming in to save a Chinese phone company that clearly broke US law … because that’s how things are done in an age when diplomacy is nothing more than personal relationships.