ZTE Deal On Brink Of Collapse After Senate Vows To Derail Trump Agreement


In the weeks leading up to Trump's meeting with Kim, the president spent hours in private meetings trying to convince Republicans to support the White House's decision to give ZTE another chance. But Trump's pleas did little to disabuse lawmakers of their opposition to the deal. In fact, the Senate is expected to pass the defense bill - with the ZTE-killing amendment attached - later this week. And it's looking increasingly likely that the House will adopt a similar measure during the conference committee for the bill.

Sen. Tom Cotton, one of the amendment's main backers, said he believes Trump won't veto the defense bill if it passes with the ZTE measure attached - though he wouldn't say where he got the idea.

On Monday, Mr. Cotton predicted that Mr. Trump wouldn’t use his veto power to reject the defense bill over the ZTE language. Mr. Cotton, who speaks regularly to Mr. Trump, declined to say whether the president had given him a personal guarantee. "I don’t reveal my private conversations with the president," Mr. Cotton said.

In a Tuesday interview, Mr. Van Hollen said: "If the president’s backing down, that’s a good thing for the country." He added: "We would welcome a statement from the president saying he made a mistake and that he now supports the bipartisan amendment on this."

The Commerce Department announced in April that it would prohibit US companies from selling parts to ZTE, a move that effectively doomed the company. Roughly a month later, Trump tweeted that he and Chinese President Xi Jinping were searching for an alternative way to deal with the ZTE problem as Trump declared "too many jobs in China lost!"

While that tweet incensed many lawmakers and officials involved in the defense and intelligence sectors (many have long suspected ZTE and other Chinese telecoms firms of aiding Chinese intelligence gathering efforts), it suggested that ZTE would be a key component of the grand "deal" that Trump is seeking to forge with China (though Wilbur Ross has insisted that the administration's decision to spare ZTE wasn't part of a broader quid pro quo).

Instead of banning ZTE from buying US goods, the company will pay a $1 billion fine, and place an additional $400 million in escrow to be paid out if the company again violates its settlement with the US government. In addition, the company has promised to replace its senior leadership and its entire board, while also funding a compliance operation that will continue for the next decade.

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