China and US agree ‘broad outline’ of settlement over ZTE ban, WSJ says
ZTE deal would include major changes to ZTE management, the board and potentially significant fines, according to the report
China and the US have agreed on the “broad outline” of a settlement to the seven-year ban on ZTE buying American technology, ending a punishment that threatened to put the company out of business, The Wall Street Journal reported.
The details are still being worked out but would include major changes to management, the board and potentially significant fines, the newspaper said Tuesday, citing unidentified people familiar with the matter. Larry Kudlow, President Donald Trump’s top economic adviser, said over the weekend that similar measures would be needed before the US would consider a reprieve.
A spokesperson for ZTE declined to comment on the WSJ report on Tuesday. At a regular foreign ministry briefing in Beijing, a government spokesman said that the joint China-US statement on economic and trade consultations issued at the weekend had covered the matter. The two countries have reached an important consensus on their trade relations and are working out the details, the spokesman said.
The WSJ reported a week ago that any reprieve for ZTE would also involve Beijing removing tariffs on billions of dollars of US agricultural products, according to people in both countries briefed on the deal.
ZTE has been forced to halt major operations after the US slapped a ban on China’s second-largest maker of phone networking equipment for violating a settlement on breaching sanctions and then lying about it. Last week, Trump posted a tweet saying he was working with Chinese President Xi Jinping to help ZTE “get back into business, fast”. A person familiar with the company’s operations told the South China Morning Post on May 9 that the public may have underestimated the impact of the US denial order on ZTE’s business.
