Trump strikes deal with China on ZTE: report
Kingsview Asset Management's Scott Martin on reports a deal was reached to save China's ZTE.
The Trump administration reportedly told lawmakers on Friday that it has reached a deal to keep Chinese telecommunications giant ZTE in business after the U.S. banned the company from buying American products for violating sanctions.
The deal would require ZTE to pay a hefty fine, shake up its management structure and hire American compliance officers, according to The New York Times, which cited a person familiar with the matter. The U.S. government would then lift the seven-year ban that prevents ZTE from buying U.S. products. The restriction was imposed after the company allegedly violated sanctions the U.S. government has in place on Iran and North Korea.
The administration could announce the deal as early as Friday, the Times reported. ZTE has taken a severe hit from the ban, estimating about $3.1 billion in losses.
While such an agreement is viewed as a way to advance trade negotiations with China, lawmakers could be resistant to a deal. Sen. Marco Rubio, R-Fla., said on Twitter Friday that the president's proposed compromise benefits China at the expense of U.S. companies.
On Thursday, members of the House of Representatives, citing national security concerns, voted to ban government agencies from using ZTE technology and the Defense Department from renewing contracts with vendors that work with the company. That bill was approved after the administration signaled it was reconsidering penalties against the company.