Exclusive U.S. clears hurdle to lifting ban on China’s ZTE

Exclusive  U.S. clears hurdle to lifting ban on China's ZTE

(Reuters) – The U.S. signed an agreement with ZTE Corp (000063.SZ) that paves the way for the Chinese tech company to resume operations after a nearly three-month old ban on doing business with American suppliers, the Commerce Department said on Wednesday.

The ban on China’s No. 2 telecommunications equipment maker will be removed once the company deposits $400 million (301.9 million pounds)in an escrow account in a U.S. bank, the Commerce Department said, which it can do after Commerce officials signed an escrow agreement.

Once lifted, ZTE, which employs around 80,000 people, is expected to restart major operations, which would remove a sticking point within the broader U.S.-China trade war. The reprieve for ZTE coincides with a new Trump administration threat of 10 percent tariffs on $200 billion of Chinese goods.

Reporting by Karen Freifeld

News Source ReutersNews

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