Employees at telecom equipment maker ZTE Corp, based in China, cheered on U.S. President Donald Trump’s tweet that suggested resolution was in sight for the ban on sales to the telecom company.
In a reversal, which was unexpected, of a hardline stance by the U.S. on this issue, the president said Sunday in his tweet that he and the President of China Xi Jinping had been working to give ZTE an avenue to return to business and fast, citing many job losses in China.
Last month ZTE was handed a ban by Washington that forbid firms in the U.S. from supplying the company with any technology and components after it violated export restrictions in the U.S. went it shipped goods illegally to Iran. It since has said that it suspended its main operations.
The tweet by Trump was reposted many times by employees at ZTE across social media containing comments that expressed relief, as they took it as being a signal that a settlement was near.
One manager at ZTE wrote, “breaking good news.” On her account with WeChat, pointing to the remark by Trump that the U.S. Department of Commerce was instructed to get it done.
According to one source close to ZTE, the company’s management welcomed this new development and is planning to negotiate with the U.S. for resolutions under the guidance of the government of China.
The latest news boosted semiconductor and telecom related stocks across China, which on Monday were amongst the best performing.
One supplier of ZTE and a communications network maintenance provider Zhong Fu Tong saw its shares rise by 10%, which is the daily limit allowed in China.
Employees at ZTE expressed surprise and were optimistic at the latest events, although some voiced concern as it remained unclear the length of time it might take to lift their ban and what it would end up costing.
An analyst on Wall Street expected caution related to the ZTE news as he said that it did not mean the trade conflict that is focused on technology between the U.S. and China was over.
He added that Trump appears to have done this out of a goodwill gesture at the request of China so that trade talks could continue and because he was expecting China to offer concessions.