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Could Trump be the ZTE saviour?

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The threat of extinction for ZTE was realistic as it seemed the US was gaining the upper hand in the apparent US/China trade war, but President Trump might prove to be an unlikely hero for ZTE.

Only a couple of days after ZTE announced it was ceasing all major operations as a result of the US ban shattering the firms supply chain, Trump revealed in a couple of tweets he and President Xi were working alongside each other to turnaround fortunes. Few would have predicted this turn of events, but the Trump presidency has been anything but predictable to date.

What this actually means remains to be seen. Details are expectedly light, but Trump has called the US Department of Commerce into action to save the troubled telco vendor. The Department of Commerce has not made an official comment as yet, but what might be expected are tighter restrictions on ZTE.

This is part of what makes the situation complicated. The threat of expulsion and restrictions was not enough to keep ZTE honest the first time around, so what the Department of Commerce can do this time is not known for the moment. Both parties are heading into waters unknown for the moment, but perhaps this will be a bit of a wake-up call for ZTE.

Certain aspects of the ZTE business need to remain reliant on the US, but it has been reported that 80% of the business is. ZTE’s relationship with Google is pretty much unavoidable, such is the dominance of Android on the OS world, but allowing such a dependence everywhere else to develop over time now looks like a ridiculous development.

While Trump coming to the saviour of ZTE might have surprised some, it could prove to be an inspired move. The President now seemingly has the upper hand at the negotiating table with the Chinese government; the US can now effectively decide the future of the business. That is a powerful card to hold.


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