back to article Prez Donald Trump to save manufacturing jobs … in China, at ZTE

United States President Donald Trump has signalled an intervention to avoid job losses at Chinese networking-kit-and-smartmobe-maker ZTE. The US Department of Commerce recently imposed penalties on ZTE after finding it sold kit to Iran and North Korean in contravention of US sanctions and undertakings not to do so. Those …

  1. Anonymous Coward
    Anonymous Coward

    Deep in it

    I just wish there was some depth of mind behind all this. Cuz economics is complicated, and at the international levels thrice over. As it is we have a supposed real-estate developer waving red flags in the faces of world leaders saying "wanna make a deal? a huuge deal?" What's next, Duterte at the WHO?

    1. Anonymous Coward
      Anonymous Coward

      Re: Deep in it

      Right.

      There might be a cleverly planned reason behind this, for example because of American suppliers of ZTE suffering (although you would think ZTE's losses would result in more phones sold by their competitors).

      But since Trump is known to not read the normal presidential briefing he may just not have heard about ZTE and made a rash decision on the phone :(. Not the most reassuring :(

    2. Lee D Silver badge

      Re: Deep in it

      Try an interesting thought experiment:

      Imagine if the US president was someone who would do whatever the highest bidder / whoever bribed him more / whoever let him have a golf course asked of him without any concept of international politics whatsoever.

      Now look at Russia, Israel, Iran, North Korea, ZTE, the NRA, etc.

      1. Peter2 Silver badge

        Re: Deep in it

        Try an interesting thought experiment. Cause and effect.

        Cause: USA was widely reported as turning screws on China trade, hoping that this will force China to force North Korea to the negotiating table. (ie; https://www.theatlantic.com/international/archive/2017/12/north-korea-test/547073/)

        Effect: Some pressure applied by China. Some sanctions ignored, notably ZTE ignores sanctions and continues to provide networking equipment, oil continues to flow (but through ships transferring oil to each other at sea)

        Cause (March 2018): USA starts throwing weight around. Ships breaking sanctions have previously been identified and seized. Local countries to NK have also been encouraged to step up maritime patrols to catch sanction violations. Sanctions are announced that will (completely legally) bankrupt the Chinese company ZTE.

        Effect (on China, March 2018): Ignored by media, so obviously the impending loss of major companies had no impact on China.

        Cause (Through China in March 2018): Again, obviously none, because the media didn't report on it.

        Effect:(April 2018) : NK "spontaneously" announces that it wants peace talks.

        Cause: (May 2018) NK sets peace talks date. Foreign prisoners are released as a show of good faith.

        China's leader asks nicely if those ZTE sanctions could go away, obviously just because he's nice.

        Obviously because he's just nice Trump agrees, and commands that sanctions not be implemented.

        It should not take an intellectual genius to spot what's missing here, and it equally does not take an intellectual genius to spot why the media wouldn't report it.

        Simply, publishing that Trump forced China to force North Korea to the negotiating table would be positive news about Trump, and the media has long since demonstrated that they only publish negative news about Trump, and so the only way to attack Trump is to ignore the obvious quid pro quid and then run an attack story on him releasing the sanctions as being bad for American business, or him being stupid for implementing them in the first place.

        1. Lee D Silver badge

          Re: Deep in it

          All of that assumes the impetus is solely "peace with North Korea".

          There's not going to be any significant amount of trade with NK, not compared to pissing off China, etc.

          Given the state of global governments, I think that's incredibly optimistic as being the driving cause.

          I think it's probably got more to do with a suppressed NK press story about the mountain base that was being used for all their atomic testing suddenly collapsing in an accident. Because it went very quiet on that front, right about that time.

          Now, that could just be "NK had an accident, want to save face" or it could be "NK was infiltrated and their nuclear capability removed" but thinking that the US is operating solely on the basis of peace in NK feels a little blinkered.

          I imagine it's much more likely "NK cannot afford to be a nuclear power after their main testing base is destroyed, therefore pretend that peace is now suddenly the best option and oh, look, isn't this new president that was only just threatening us with war moments ago such a great negotiator".

        2. DougS Silver badge

          Trump does not deserve credit

          Giving Trump credit for NK wanting to talk is ridiculous. They want to talk because their nuclear program has reached a successful completion. They've demonstrated nukes, a hydrogen bomb, and missiles able to reach the US. They have nothing to prove by further tests, since the only thing they haven't demonstrated is the ability to deliver a nuke on an ICBM which they can't do for obvious reasons. Their H-bomb test supposedly caused significant damage to their test site, so it is easy for them to make themselves look good by saying they will decommission it "as a sign of good faith".

          After they expended so much effort developing nuclear weapons and the means to deliver them, they aren't going to "denuclearize". They might claim they will, but with such a closed off country we know so little about internally, it would be easy for them to have long ago hidden a few nukes, international inspectors can only look in places they know to look, and they wouldn't know where to find them. NK has previously made "deals' before they haven't kept, only a fool would take them at their word that will denuclearize.

          What they really want is for sanctions to be lifted, so they will agree to decommission their useless test site, hand over / destroy their centrifuges, allow international inspectors to check their reactor(s) to insure they aren't generating high grade uranium that can be refined to weapons grade, etc. They will hand over a few nukes and missiles, claim that's it, but it won't be. They would never give up everything, even in exchange for the US pulling all troops from SK (which we might agree to but will have such a long timetable it will never actually happen)

          Anyway, why would they trust the US to keep a deal after Trump tore up the Iran deal? There's zero guarantee that the next president wouldn't decide Trump made a bad deal with NK if he agreed to remove all troops, and reverse that order.

          1. Sanguma Bronze badge

            Re: Trump does not deserve credit

            "Giving Trump credit for NK wanting to talk is ridiculous. "

            Stands to reason. I think the two Koreas decided to start talks ASAP because at the current moment South Korea is hosting the mad-on-wargaming US military, who do after all have nukes themselves, and the Korean Peninsular cannot afford a nuclear-armed lunatic running around Korea and bullying locals.

            Within a few years I expect the US military will be out of the Korean Peninsular.

            The problem about the "everything due to the US Prez" scenario is that it neglects the Koreans, who have rather more skin in this than the US Prez ever will. And besides, I don't like personality cults such as Soviet one of Stalin, or the US Republican one of Ronald Reagan. I don't want one of Donald Trump, not when Donald Duck reports he loves the taste of Peking Trump and hopes to enjoy some more of it soon.

  2. Mark 85 Silver badge

    If that were to happen it would hardly be good for US companies either,

    Therein is probably the real reason for rethink on this. I'm sure there were more than a few lobbyist and CEO phone calls made. He ran on a jobs and "make America great" and that probably came back to bite him.

    1. thames
      Boffin

      ZTE is also a major customer of certain US chip manufacturers, particularly in ZTE's networking gear. For example Acacia gets 30 percent of their revenue from ZTE. Acacia's share price went into free-fall when the news came out. The same is true for a bunch of other American suppliers.

      ZTE can source many components from other places, but will have difficulties doing so with some.

      However, this situation is a long term problem for US companies who supply anybody outside the US. While their name might not be on the box, a lot of the value of what is nominally Chinese kit is actually made in the US, South Korea, and Japan. The Chinese assemble it and put a "made in China" label on it, but the majority is actually made elsewhere.

      The Chinese government's current economic plan is to design and build more of this high-tech chippery in China. If the US is seen as too risky of a supplier, that will only accelerate this trend in China and the rest of the world to the detriment of US business and the US economy.

      I should note that many European defence firms go to great lengths to avoid American suppliers because of the risk inherent in buying from the US. Look for "ITAR-free" suppliers as an example of this.

      1. Mark 85 Silver badge

        I should note that many European defence firms go to great lengths to avoid American suppliers because of the risk inherent in buying from the US.

        For the most part, the US military is the same way.

      2. HausWolf

        So you are saying that even though ZTE has been found to be violating the law regarding sanctions, trump decided to use his influence to try to help them out?

        1. DiViDeD Silver badge

          "..ZTE has been found to be violating the law.."

          Since when did America start giving a shit about international law?

  3. Blockchain commentard Silver badge
    Trollface

    Do the Chinese have something on Trump or are the Russians just sharing the golden shower video?

  4. 89724105618769278590284I9405670349743096734346773478647852349863592355648544996313855148583659264921 Bronze badge

    That's one way to look like a hero

    lol

  5. Anonymous Coward
    Anonymous Coward

    ZTE and Huaweii backdoor all their chips

    It's been known since at least 2012 https://intelligence.house.gov/sites/intelligence.house.gov/files/documents/huawei-zte%20investigative%20report%20(final).pdf

    1. The Original Steve

      Re: ZTE and Huaweii backdoor all their chips

      That's certainly NOT what the Exec Summary states.

      The summary says that neither ZTE nor Huawei answered the committees answers adequately, which in their own words does not prove they are a risk / are doing anything wrong - but does not answer security related questions the US state has.

      Report seems to suggest that they cannot be trusted, but that there is no proof - yet.

      I'm a HPE ProCurve / Aruba man personally, however after needing a DCB supported 10G switch for a project and a budget of just £5k (one of my team failed to estimate the networking costs earlier in the project) I'm now buying my first Huawei kit. £6k for 2 x 10Gig SPF+ datacentre grade switches is a price worth paying compared to £13k for HPE. As the switches are not going to be internet facing I'm comfortable with that trade off.

      1. 4Candle

        Re: ZTE and Huaweii backdoor all their chips

        Absolutely.

        Actually IIRC Huawei have been given an OK by CESG in the UK - it needed a code inspection in Cheltenham as past of an openness deal. Lots of hot air being spouted by protectionists.

        Do I trust Intel or Qualcomm more than Huawei? Not really.

    2. DJO Silver badge

      Re: ZTE and Huaweii backdoor all their chips

      Well if there are back doors in the silicon then as most of it was sourced form the US it's hardly ZTEs fault.

      But it would be amusing although unsurprising if the US refused to buy kit because of the back doors put in by the US itself.

    3. Anonymous Coward
      Anonymous Coward

      Re: ZTE and Huaweii backdoor all their chips

      Just like Intel, AMD and Cisco. Possibly Juniper too. Intel and AMD are proud of their 'management' backdoor and proudly flaunt it.

      I wouldn't trust any of them an iota more than ZTE or Huawei. Would you and why?

    4. DiViDeD Silver badge

      Re: ZTE and Huaweii backdoor all their chips

      It's been alleged by the americans since at least 2012.

      There, FTFY

  6. Anonymous Coward
    Facepalm

    Diplomacy?

    The Chinese Govt threatened to switch 20 million desktops to Linux rather than keep the warez install of Windows 7.

  7. Adam 52 Silver badge

    "ZTE has, in any case, indicated it will appeal and believes it will be cleared."

    That's not what other news organisations are saying. The BBC goes with "ZTE admitted to violating US sanctions" and the Guardian and FT both have "ZTE said in its statement it is 'actively communicating' with the relevant US government departments in order to 'facilitate the modification or reversal' of the export ban".

    1. Robert Carnegie Silver badge

      What's true?

      I'm not on top of this subject, but I think the "sanctions" bit is about selling phones to Muslims, which the U.S. didn't want to be done. The other accusation, that ZTE phones are smelly, is disputed.

      The other other accusation seems to be that ZTE pays bribes for favourable decisions in import-export matters. I suspect that President Trump pricked up when he heard that.

  8. Bloodbeastterror

    Just how much longer will America tolerate this incompetent blundering fool trying to destroy the world?

    1. NukEvil
      Mushroom

      About as long as we will tolerate you idiots regurgitating fake news and flooding our social media outlets with your stupidity.

  9. Stoneshop Silver badge
    Headmaster

    "Sanctions one week, diplomacy the next"

    That's a definition of 'diplomacy' of which I was not previously aware.

  10. Anonymous Coward
    Anonymous Coward

    A bank account has just been opened in Hong Kong under the name of Donald Wong and large sums deposited, allegedly.

  11. Anonymous Coward
    Anonymous Coward

    Borat like Trumpmenistan a lot.

    Borat come to visit soon!

  12. Anonymous South African Coward Silver badge

    Cause and effect.

    Cut off some trade partners, and some of your own people/factories/whatever may need to close up shop.

    And somebody else will fill that niche*.

    *Most probably somebody you don't want to do trade with, leaving you in a poorer position.

  13. Anonymous Coward
    Anonymous Coward

    It looks weird but then it's El Reg reporting so...

    At first glance it looks weird but The Register is somewhat rabidly -by somewhat I mean frothing at the mouth, red eyes bulging- biased against Trump and not above twisting a story to back its own narrative.

    For example:

    El Reg: "ZTE has, in any case, indicated it will appeal and believes it will be cleared."

    In contrast, credible news organisations, even ones inclined to disagree with Trump on principle, are saying "ZTE admitted to violating US sanctions" (BBC) or "ZTE said in its statement it is 'actively communicating' with the relevant US government departments in order to 'facilitate the modification or reversal' of the export ban" (The Guardian).

    (Credit to Adam 52 for spotting the spin).

    1. Chris G Silver badge

      Re: It looks weird but then it's El Reg reporting so...

      The BBC and the Grauniad are credible?

      Okay, there is no law to stop you thinking that!

    2. Edwin

      Re: It looks weird but then it's El Reg reporting so...

      Yes, Apple must be delighted to be out of El Reg's crosshairs :)

  14. Anonymous Coward
    Childcatcher

    Oh, Matron!

    Will Stormy Daniels now complain of being 'back-doored' by The Donald?

  15. Anonymous Coward
    Anonymous Coward

    Maybe its just that Pres Trump likes to negotiate with other national leaders on a personal basis, since he feels that this approach has been the basis of his own success. Hence his enthusiasm for top-level meetings with his peers as the only forum for getting things done, and his total disinterest in diplomacy and "small print" issues. Also why he doesn't like multi-lateral agreements.

    1. Anonymous Coward
      Anonymous Coward

      Maybe its just that Pres Trump likes to negotiate with other national leaders on a personal basis, since he feels that this approach has been the basis of his own success

      Yes, but you have to go further and remember he delusionally thinks he's the best deal-maker ever (when in fact, he's just very good at bullying), and also a large part of his policy in general is "do the opposite of what Obama did".

  16. Kev99

    让中国再次走向伟大

    1. John Bailey

      Well.. they already have the hats in production.

  17. Anonymous Coward
    Anonymous Coward

    Just as a precaution..

    If you own a ZTE phone you may want to disable any KISS Trust Certificates if present.

    (And probably a few others while you're at it)

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