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President Trump tweets defense of his push to save ZTE

ZTE buys a lot of individual parts from US companies, he says.


President Trump defended his push to get ZTE back in business. 


President Donald Trump is doubling down on his defense of Chinese telecommunications giant ZTE

Trump said on Twitter on Monday that ZTE, the fourth-largest smartphone maker in the US by market share, "buys a big percentage of individual parts from U.S. companies." HE also said ZTE was "reflective of the larger trade deal we are negotiating with China and my personal relationship with President Xi."

This follows the surprising tweet that Trump sent out Sunday, in which he called for the US Commerce Department to find "a way to get back into business, fast." ZTE faces a denial order from the Commerce Department that bans US businesses from selling it products and services for seven years -- which experts called a "death sentence" for telecommunications equipment maker. The punishment came about because the agency had determined that ZTE failed to follow through on a settlement over selling equipment to Iran and North Korea.

The Commerce Department pointed to Commerce Secretary Wilber Ross' remarks at a National Press Club luncheon on Monday, in which he hopes "that we can make a fair deal."

The White House didn't immediately respond to a request for comment.

ZTE declined to comment.

ZTE has become a critical part of the broader discussions between China and the US, the two largest economies in the world, over trade tensions and whether the two countries can prevent a trade war that could involve billions of dollars' worth of tariffs. It's a surprising turn for Trump, who made saving American jobs -- not Chinese jobs -- a core part of his campaign platform. It also stands in contrast with the manner in which the president has used to Twitter to attack companies he doesn't like, including Amazon, whose CEO, Jeff Bezos, who also owns the Washington Post, which has been critical of Trump.

ZTE had been in dire straights before the Sunday tweet, having last week disclosed that it had to shut down its "major operating activities." The issue is the ban prevents it from accessing critical, and proprietary, parts of Google's Android operating system, including its Google Play application store. 

The company had been quietly pushing to overturn the order and had pegged its hopes on the talks between US and China, according to people familiar with the company's thinking. 

ZTE has made the argument that it invests a significant amount in the US. Last year it spent $2.34 billion on US products and services that go into ZTE smartphones and networking equipment, according to a person familiar with the company. Major partners include companies such as Qualcomm, Intel, Broadcom and Texas Instruments

On the company's failure to properly punish employees involved with the settlement, the person blamed the problem on an HR and process problem, and not a scheme to defraud the US government.

Originally published May 14 at 1:24 p.m. PT.
Updated at 1:52 p.m. PT:  Added comment from the Commerce Department.

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