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Trade war

ZTE vows to fight crippling US restrictions

Commerce department's ruling is unacceptable, says Chinese telecom gear maker

U.S. companies have been prohibited from purchasing equipment from Chinese telecom ZTE for seven years.   © Reuters

Chinese telecom equipment maker ZTE said Friday that it will fight U.S. moves to impose crippling restrictions, the latest escalation in the battle over technology dominance between the world's two largest economies.

ZTE said in a statement that they were "determined, if necessary, to take judicial measures to protect the legal rights and interests of our Company, our employees and our shareholders," after the U.S. Commerce Department decided to ban American companies from selling smartphone components to ZTE.

The Commerce Department made the ruling after the Chinese company was found to have violated an agreement over trade sanctions against Iran.

The statement also said it was "unacceptable" that the Commerce Department "insists on unfairly imposing the most severe penalty on ZTE" before the facts are completely investigated. 

The U.S. decision "will not only severely impact the survival and development of ZTE, but will also cause damages to all partners of ZTE, including a large number of U.S. companies," it added.

ZTE is now facing major problems. Earlier this week, the U.S. Federal Communications Commission announced a ban on U.S. telecoms buying equipment from foreign companies that are deemed a security risk. Two Chinese giants, ZTE and Huawei Technologies, are likely to be targeted by the ban.

The administration of U.S. President Donald Trump is stepping up pressure on China to open its markets and stop its unfair practice of obtaining advanced technologies from American companies. Washington is now threatening to impose tariffs worth as much as $150 billion on Chinese imports, a move largely targeting China's advanced technology industries.

Mitsuru Obe

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