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.
Trump has made it clear that he doesn’t like international agreements, he not only prefers to deal one-on-one, but on a personal basis. His action in offering to save a Chinese company whose actions went directly against the interests of the United States, comes from how Donald Trump is doing business.
Under Trump, the State Department has been sidelined. Instead, the US has moved to the era of Mar-a-lago diplomacy, where international actions are determined by how well foreign leaders praise Trump’s golf course and express appreciation for the “world’s best chocolate cake.”
Trump isn’t dealing with China. He’s dealing with General Secretary Xi Jinping. And just as he’s done in his personal business dealings, Trump isn’t letting things like rules, or laws, get in the way. That’s because Trump understands that Xi still has enough pull on North Korea to squash his upcoming one-on-one with North Korea’s Kim Jong-un.
And in an age where all politics is personal, and nothing is more important than a photo-op, that’s what really counts.
The question will be if Trump is more effective at saving jobs for a Chinese company, than he has been for those companies he promised, and failed, to save in the US.
