Lawmakers Concerned About President’s Plans for ZTE

UPDATE Lawmakers from both political parties are alarmed over President Donald Trump’s plans to help Chinese telecom manufacturer ZTE. Concerns were expressed on both sides of the aisle during a hearing Wednesday regarding threats to national security and the nation’s telecom supply chain by the House Communications and Technology Subcommittee, a subgroup of the Commerce Committee.

Rep. Adam Kinzinger (R-IL) is “concerned” the president’s comments mean “loosening up” on ZTE, reported The Hill. The Commerce Department in April barred U.S. firms from supplying the Chinese company after it said ZTE violated U.S. sanctions against Iran and North Korea and the Chinese telecom manufacturer agreed to pay a $1.2 billion fine. But, as Inside Towers reported yesterday, Commerce Secretary Wilbur Ross said ZTE didn’t live up to the agreement.

Sunday, Trump tweeted that he’s working to give ZTE “a way to get back into business, fast” and he “instructed” the Commerce Department to help the company. Kinzinger hopes the president’s comments were “misinterpreted.”

The president muddled his own foreign policy” with the tweet “even after the Commerce Department announced strong sanctions for ZTE risking our national security,” said Rep. Frank Pallone (D-NJ) yesterday.

To calm the waters, President Trump tweeted Wednesday: “Nothing has happened with ZTE except as it pertains to the larger trade deal,” adding that the second round of trade talks had not yet begun.

During the hearing, Samm Sacks, Senior Fellow, Technology Policy Program, Center for Strategic and International Studies, told lawmakers about the issues posed by China’s emergence as a technological global power. She said the U.S. and Chinese technology development, supply chains, and commercial markets are “tightly intertwined.” An approach that “isolates” the United States, will “undermine” America’s economic prosperity, technological leadership, and capacity for innovation, according to Sacks. “In confronting China, we must have a clear understanding about the consequences of our actions, and where there will be costs to ourselves,” she said.

The FCC recently voted to ban U.S. companies that supply companies deemed to pose national security threats from receiving Universal Service Fund monies. The change doesn’t identify ZTE and another Chinese telecom manufacturer Huawei, but is perceived as being aimed at them. Wilkinson Barker Knauer Partner Clete Johnson said the FCC action, “will advance the policy discourse on these difficult issues and can be a lever to move the whole government, and the market, in the right direction.”   

May 17, 2018         

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