WASHINGTON (Reuters) - White House economic adviser Larry Kudlow said on Tuesday it was far from certain what steps the U.S. government would take on China’s ZTE Corp (000063.SZ), which he characterized as an enforcement, rather than trade, issue.
U.S. President Donald Trump has directed the Commerce Department to revisit penalties for telecom equipment maker ZTE for flouting U.S. sanctions on trade with Iran, saying it is a big customer of U.S. suppliers.
Kudlow was critical of ZTE in an interview with the Politico news outlet, saying it was a “very poorly run company” with “many internal flaws.”
Trump has directed Commerce Secretary Wilbur Ross to review “remedies” for ZTE, Kudlow said.
“This is principally an enforcement issue, by the way. It’s really divorced from the trade story,” Kudlow said.
“I think the issue here is how harsh the remedies, how harsh the enforcement,” Kudlow told Politico. “The issue here is not simply letting them off but perhaps to do so in a manner that they could conceivably go back into business. I don’t want to get that far down the road but I think that’s the intent.”
Trump, who campaigned for the White House pledging to get even with China on trade practices that hurt American consumers, faced backlash from Republican and Democratic lawmakers after he promised to work with Chinese President Xi Jinping to help ZTE,