According to a Reuters report, the Trump administration may soon claim as much as $1.7 Billion from Chinese company ZTE. After ZTE was suspended from doing business with U.S. companies on April 15, the company suspended its main business in May and urgently needs to resume its businesses. There have been intense talks between the Chinese government and the U.S. government to tackle this situation and the option of a hefty fine may be the quickest solution.
Gizchina News of the week
It is estimated that ZTE has lost over $3 billion since it was banned from doing business with U.S. suppliers. Among the devices sold by ZTE, 25-30% of the components are provided by US companies. On May 30, ZTE issued an announcement saying that due to the refusal order of the US Department of Commerce’s Bureau of Industry and Security (BIS), the company’s shares will continue to be suspended.
On April 15, the U.S. Department of Commerce announced that it would ban U.S. companies from selling components, goods, software, and technology to ZTE for seven years until March 13, 2025. The reason is that ZTE violated the US sanctions clause that restricts the sale of U.S. technology to Iran.
OK, they broke the rules (as laid down by the US) but a fine of 1.7 billion seems to be very excessive to me, a bit bullying in my opinion. As usual, the US sets itself up as the world’s police department. This, to me, is an abuse of power.