Trump has openly demanded that the US Department of Commerce put ZTE on its way. This is obviously because the U.S. and China have reached even more agreement. The U.S. is willing to spare Zeng this original pressure piece at the request of the Chinese government.
ZTE has never been the purpose of the United States, but a means of exerting pressure on negotiations.
Tweet-governance countries have a good time, and the policy trends are known. Every morning, look at US President Trump's Twitter, you can first understand the United States inside and outside events, get the president's personal attitude. This is more clear than the news of the traditional media, and it is also faster than the announcement of government agencies. His tweets have three major characteristics: simple words, direct attitudes, and deaf people.
ZTE is returning to life
Maybe it's Mother's Day. Today's Trump on Twitter hasn't had the irritability of the past. After launching a blessing for Happy Mother's Day, Trump suddenly sent a tweet that touched the nerves of the Chinese people: "China President Xi and I are working together to give China's big mobile phone company ZTE a quick way to resume business." (If ZTE goes bankrupt) China loses too many jobs. I have instructed the U.S. Department of Commerce to do this. ”
For ZTE, who has been suffering from desperation for almost a month, Trump's tweet is undoubtedly a great news for life-saving. The U.S. Department of Commerce announced on April 16 that since ZTE has not complied with the settlement agreement reached with the U.S. government, it will impose a technical sales ban on ZTE for a period of seven years up to 2025. During this period, U.S. companies are prohibited from selling parts and products to ZTE. Software and Technology.
Even the world’s fourth-largest telecommunications equipment manufacturer, ZTE’s core technology components cannot be separated from the US technology giant’s partners in the global globalization of the technology industry. Therefore, for the ZTE, the United States' ban on sales is equivalent to a paper death sentence. As ZTE’s senior executives later said, the US’s ban on sales has caused the company to fall into a state of shock and the business has stagnated.
As ZTE illegally exported telecommunications equipment to Iran, in 2016 the United States issued a restraining order to ZTE, forcing ZTE to plead guilty in 2017 and pay the US government a fine of US$1.2 billion (the initial payment of US$890 million) and accept a series of rectification penalties. . The reason why the United States punished ZTE again was that although ZTE had restructured its management and dismissed four directly responsible senior executives, it did not punish 35 business-related employees according to the settlement agreement, but instead awarded bonuses to them. Provide false statements to U.S. government investigators.
ZTE can't fall
When the US financial crisis ten years ago, there was a buzzword "Too big to fail"; it means that some giant companies, even if they died, the government can not let them go bankrupt. The U.S. government took the initiative to help Goldman Sachs, Morgan Stanley, and American International Group (AIG) to provide interest-free loans to the Detroit auto giants General Motors and Chrysler, which were on the verge of bankruptcy, in order to avoid the collapse of these giants to the economy and society. More negative impact.
ZTE is also a giant that cannot be allowed to close down in China’s technology industry and even China’s economy. ZTE is a giant enterprise with annual revenue of RMB 100 billion and 80,000 employees. Its industrial chain also involves hundreds of thousands of jobs. ZTE is an important force for China to win the global right to speak in the era of 5G communication. It has applied for eight consecutive years. Ranked among the top three in the world; more importantly, ZTE is one of the most successful Chinese companies in globalization, and its overseas business is of greater significance to the Chinese government’s “Belt and Road” strategy.
It is precisely for this reason that the Chinese government will not sit back and watch ZTE dying under the US ban, and has been actively helping ZTE in its good offices and negotiations. When the United States first issued a ban on resale orders for ZTE in 2016, it was the Chinese Ministry of Commerce that helped ZTE apply for a stay in the United States, so as to gain time to reach a settlement agreement on guilty plea.
After the U.S. Department of Commerce punished ZTE again, it was once tough to say that "no reconciliation is possible" and that the outside world once thought that the limit of ZTE was approaching. However, Trump’s tweet statement shows that with the attention and help of the Chinese government and leaders, under the direction of the US president, the US Department of Commerce will eventually change its position and give ZTE another chance to reconcile. ZTE may again pay fines and may receive other penalties, but at least it is hopeful that the ban will be lifted and the core components needed for the procurement business will allow the company to get back on track.
Sino-US interests game
Why does Trump ask the U.S. Department of Commerce to open a new window on ZTE? ZTE is also the fourth largest smart phone manufacturer in the US market, and has hundreds of partners in the United States, creating tens of thousands of jobs. From this perspective, the relief of ZTE is indeed beneficial to the interests and employment of the United States. However, it is clear that Trump will not require the U.S. Department of Commerce to change its stance because of this factor. Otherwise, ZTE will not impose a lore on ZTE.
In fact, ZTE was originally not the purpose of the United States, but a means and attitude of negotiation. The former high-level officials of ZTE did indeed make many stupid mistakes. In violation of the ban on private exports to Iran, the United States also received solid evidence. However, the U.S. Department of Commerce had severely fined ZTE 8.9 billion U.S. dollars a year ago and required many corrective measures. In the middle of the month, ZTE was again punished with no penalty of 35 employees. It is obviously related to the background of the Sino-US trade war that began at the end of March.
The Trump administration proposed to levy a US$50 billion punitive tariff on Chinese imports at the beginning of April, and was therefore led to China’s returning a punishing tariff of US$50 billion. Although it seems that the trade war is imminent, the loss of both sides is not Trump's real goal for a businessman who has been in business for half a century. Using tough measures such as threats and apportionments to exert pressure on the Chinese government to make concessions on market access and import tariffs, and to reach an agreement at the negotiation table to reduce the huge trade surplus between China and the United States, this is his real purpose. ZTE provided the US government with a seemingly legitimate pressure piece at an inappropriate time.
However, Qualcomm also sent the Chinese government an exchange of chips. Qualcomm’s $40 billion acquisition of NXP Semiconductors is currently only required to be approved by the Chinese regulatory authorities. However, because the first transaction approval was rejected by the Chinese Ministry of Commerce, Qualcomm missed the original transaction completion time (April 25) and had to submit the materials to the Chinese Ministry of Commerce again. If China is again vetoed and unable to complete the transaction in July, Qualcomm will not only miss this golden opportunity to reshape the semiconductor industry, but also need to compensate NXP for US$2 billion in liquidated damages.
Sino-U.S. common interest
Trump once said that he does not think that the trade war between China and the United States is just a trade negotiation between the two parties. In the past two weeks, trade officials between China and the United States have been conducting intensive negotiations. Although there is a large gap between the requirements of the two parties and no agreement has been reached, it is clear to both parties that negotiations may be the best choice for the two largest economies in the world. The problem lies only in the conditions on which the parties agree.
However, Trump also knows that while exerting pressure on China in terms of trade issues, he is still inseparable from China on many international issues. In particular, the recent North Korea and Iran issues need to maintain good relations with China. North Korea and the United States have been able to plan a summit meeting to discuss the nuclear issue in the near future. It is inseparable from China’s assistance to the United States in pressing economic sanctions to pressure North Korea to accept negotiations. At the end of April, when it was announced that it was expected to negotiate with North Korea, Trump also did not forget to publicly thank the Chinese leaders on Twitter.
Last week, Trump announced that the United States withdrew from the joint action plan reached in 2015 (the Iranian nuclear agreement), hoping to force Iran to renegotiate nuclear waste conditions with comprehensive economic sanctions. However, apart from the United States, there are four other permanent members, Germany and the European Union. To force Iran back to the negotiating table, the United States also needs the support of the permanent member of the Security Council China.
Big country diplomacy has no permanent friends or enemies, only eternal interests. The same applies to Sino-US relations. There are many conflicts of economic and trade interests between the two countries, but there are also more common interests and areas of cooperation, including key diplomatic issues. The Trump publicly demanded that the U.S. Department of Commerce put ZTE at the forefront of life. This is obviously because the U.S. and China have reached more agreement. The U.S. is willing to spare Zeng this original pressure piece at the request of the Chinese government.