Arthur J. Villasanta – Fourth Estate Contributor
Washington, DC, United States (4E) – Disregarding bipartisan resolutions from the U.S. Congress warning him not to do so, Donald Trump went ahead and lifted the ban on U.S. companies selling goods to state-owned ZTE Corporation.
The reprieve allowed China’s second-largest telecommunications equipment maker to resume business in the U.S. ZTE released a photo showing its CEO, Xu Ziyang, and 10 other top executives grinning and each giving a thumbs-up to the news, which was also flashed on a screen at the company headquarters in Shenzhen.
The U.S. Department of Commerce lifted the ban shortly after ZTE deposited $400 million in a U.S. bank escrow account as part of a settlement concluded in June. The settlement also included a $1 billion penalty that ZTE paid to the U.S. Treasury that same month.
ZTE paid $892 million in penalties to the U.S. in connection with the 2017 settlement and guilty plea. The latest $1.4 billion deal comes on top of that. The $400 million will remain in escrow for as long as 10 years to give the U.S. government access to the money if ZTE violates the June settlement. ZTE’s Hong Kong shares jumped 24 percent after news broke the U.S. had signed the escrow agreement.
“The department will remain vigilant as we closely monitor ZTE’s actions to ensure compliance with all U.S. laws and regulations,” said Commerce Secretary Wilbur Ross said in a statement that also claimed the terms of the deal are the strictest ever imposed in such a case.
Sen. Marco Rubio (R-FL), a leading critic of ZTE, was livid at the news.
“ZTE should be put out of business,” said Rubio. “There is no ‘deal’ with a state-directed company that the Chinese government and Communist Party uses to spy and steal from us where Americans come out winning.”
His colleagues agreed with him and on July 12, a group of Republican and Democratic U.S. senators urged that ZTE’s penalties be reinstated — but to n o avail.
The Senate Banking Committee on May 22 voted overwhelmingly in favor of an amendment to block Trump from easing penalties on ZTE, which violated U.S. sanctions by selling equipment to North Korea and Iran. The panel’s action followed a similar vote by a House panel the week before.
The House delivered a stinging rebuke to Trump when the bipartisan House Appropriations Committee unanimously voted to accept an amendment that upholds sanctions against the banned Chinese firm ZTE Corporation that Trump wants to un-sanction.
The amendment to the 2019 Commerce, Justice, and Science Appropriations bill is a humiliating rebuke of Trump, whose the previous week said he wants to end the seven-year ban imposed by the Department of Commerce last month on ZTE.
The amendment’s author, Rep. Dutch Ruppersberger (D-MD), called out Trump by name on social media, saying in a succeeding statement that “This amendment, which passed with the unanimous support of my colleagues on both sides of the aisle, shows that, when the United States enacts sanctions, we stand behind them.”
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