On the evening of April 16, the U.S. Department of Commerce announced that the U.S. government had banned ZTE from buying sensitive products from U.S. companies and claimed that ZTE had made false statements to U.S. officials.
In response to this, the spokesman of the Ministry of Commerce should issue a statement to express that the Ministry of Commerce will pay close attention to the progress of the situation and stand ready to take necessary measures to safeguard the legitimate rights and interests of Chinese enterprises.
Yesterday, the Shenzhen Stock Exchange issued an announcement stating that because of ZTE's possible impact on the stock price, it has not disclosed any major issues publicly. The stock has been suspended since April 17.
On the morning of April 17, the Ministry of Commerce issued an announcement No. 38 of 2018, which decided to implement temporary anti-dumping measures against imports of stilts originating in the United States.
ZTE has been banned by the US for 7 years and Huawei is blocked by U.S.
On April 16, the US Department of Commerce issued a ban on ZTE’s exports. Until March 13, 2025, US companies will be prohibited from selling components, merchandise, software and technology to ZTE.
In response to the U.S. Department of Commerce’s announcement of the export control measures for ZTE Corporation, a spokesperson for the Ministry of Commerce stated that China has always required Chinese companies to abide by the laws and policies of the host country and operate in a lawful and compliant manner. ZTE Corporation and hundreds U.S. and U.S. companies have conducted extensive trade and investment cooperation and contributed tens of thousands of jobs to the U.S.. We hope that the U.S. will properly handle the matter in accordance with regulations, and create a fair, equitable and stable legal and policy environment for enterprises.
In recent years, ZTE and Huawei have repeatedly suffered setbacks in the United States. Earlier this year, Texas Republican Mike Conaway submitted a new bill calling on the U.S. Congress to issue a ban prohibiting U.S. government agencies at all levels from using services provided by Huawei or ZTE. The affiliates cooperated and claimed that the ban was to safeguard the national security of the United States.
Huawei originally planned to enter the U.S. market in cooperation with AT&T in 2018. This agreement was also hampered by the U.S. government's impediment. According to analysis, other communications equipment from foreign communications companies such as Ericsson and Sony have been sold in the United States for many years. Judging from the fact that the U.S. government has great prejudice against Chinese companies entering the U.S. market, it may be that Chinese telecommunications companies have been increasingly affected by 5G communications technology, and this is the main reason for being rejected.
China Implements Interim Anti-dumping Measures Against Micorgao
On the second day that the United States announced the export control of China’s telecommunications companies, on April 17, the Ministry of Commerce issued the No. 38 Announcement of 2018, promulgating a preliminary ruling on anti-dumping investigations of imported sorghum originating in the United States and deciding to The United States imported stilts to implement temporary anti-dumping measures.
The Ministry of Commerce ruled that the importation of sorghum originating in the United States was dumped, and the domestic sorghum industry was substantially damaged, and there was a causal relationship between dumping and substantial damage. It also decided to implement temporary anti-dumping measures against imported sorghum originating in the United States. According to the ruling, From April 18, 2018, when importers import imported sorghum produced in the United States, they should provide the corresponding guarantee deposits to the Customs of the People's Republic of China in accordance with the guarantee ratio of each company (178.6%) determined by the ruling.
According to Bai Ming, deputy director of the Institute of International Markets of the Ministry of Commerce, the “Trade Friction” that Trump launched against China is mainly aimed at high-tech fields. This is a pain point for China. At present, China is the second largest agricultural product in the United States. Consumer countries are second only to Canada. However, anti-dumping measures are not carried out on agricultural products such as stilts because of trade friction. On February 4 this year, the Ministry of Commerce announced that it initiated anti-dumping and subsidy investigations on US imports of stilts.
According to the Ministry of Commerce’s previous announcement, imported sorghum produced in the United States was exported to China at a price lower than the normal value. There was a relatively large amount of dumping. The number of US sorghum entering China increased, and the price continued to decline. This is similar to the Chinese domestic market. The product was inhibited and caused substantial damage and threats to the domestic industry. Therefore, it was decided to initiate investigation.
The Beijing News reporter learned that since domestic corn prices have risen significantly since the end of last year, domestic feed suppliers have increased imports of grain to the United States. Customs statistics show that in 2017, China imported a total of 4.8 million tons of sorghum from the United States. The value of about one billion US dollars is almost all of China's grain imports last year. From January to February this year, due to factors such as rising trade frictions, the scale of imported stilts dropped by 11% year-on-year.
Zhao Ping, director of the International Trade Research Department of the China Council for the Promotion of International Trade Studies, analyzes that “China is either its largest single market or its main market” for products exported to China by the United States. Among its export value, China occupies a very large proportion of its exports. huge.
According to the U.S. Grains Council, a U.S. grain export industry organization, more than three quarters of U.S. export stilts have been sold to China.
27 days spread to dozens of categories such as soybeans, automobiles, and communications
From March 23, US President Trump formally announced the punitive tariff trade friction on China's various commodities amounting to as much as 60 billion U.S. dollars. Sino-U.S. trade frictions have lasted 27 days. During this period, the two parties conducted multiple rounds of ' "Fighting against each other," as the frictions escalate, the current list of sanctions has been enlarged and it has affected many industries in both countries.
On April 3, EDT, the U.S. Trade Representative announced the 301 investigation tax proposal for China and publicly solicited opinions. The list of product proposals for taxation will involve approximately US$50 billion in exports, and the proposed tax rate is 25%, covering approximately 1,300 tax numbers. Products, involving aerospace, information and communications technology, robotics and machinery industries.
On the afternoon of April 4, the Chinese Ministry of Commerce issued an announcement announcing that tariffs will be imposed on imports of soybeans and other agricultural products, automobiles, chemicals, and aircraft imported from the United States. The tax rate is 25%, involving 2017 in China. The amount of imports from the United States is about 50 billion U.S. dollars.
Then on April 6, the US side announced that it was appropriate to consider adding tariffs to the additional 100 billion U.S. dollars of goods imported from China.
According to the statistics of the reporter, as of yesterday, the product categories involving trade frictions between China and the United States included imported steel, aluminum products, information technology, aerospace equipment, new energy equipment, high-speed rail equipment, biomedical products, robots and machinery products, soybeans, fresh fruits, , dried fruit, nuts, wine, seamless steel tubes, imported cars, pork and products, recycled aluminum, modified ethanol and dozens of categories. The Beijing News reporter Ren Jiao
■ Response
Ministry of Foreign Affairs
As the United States will become the Chinese will resolute sword
At the regular press conference of the Chinese Ministry of Foreign Affairs on April 17, spokesperson Hua Chunying stated on the trade friction between China and the United States that China will pay close attention to the progress of the situation and stand ready to take necessary measures to safeguard the legitimate rights and interests of Chinese enterprises.' The US will behave in a wayward manner and continue to move against the tide. We will surely stand by it and resolutely shine our sword to win this multilateralism and free trade protection battle. This is not only to safeguard China’s legitimate rights and interests, but also to safeguard the rules of the world’s multilateral trading system. . '
Hua Chunying stated that on the Sino-U.S. economic and trade friction caused by the U.S. 301 investigation, we have clearly and clearly stated China's position on many occasions. U.S. behavior is typical of unilateralism and naked economic hegemony. China and the U.S. are both major countries in the world and economic depth. Integration, should respect each other, treat each other as equals, cooperate and win together.
Bureau of Statistics
Sino-U.S. Trade Friction Is Hard to Overcome China's Economy
Officials of the National Bureau of Statistics (NBS) said on Tuesday that trade frictions between China and the United States will not hinder the stability and recovery of China's economy. Spokesman Xing Zhihong of the National Bureau of Statistics stated at the press conference on the operation of the national economy in the first quarter of this year. The healthy upward trend of the world’s second largest economy will not change due to friction.
Xing Zhihong believes that China’s current economic stability is stable, China’s economic stability, coordination, sustainability is enhanced, economic resilience is good, potential is sufficient, and there is plenty of room for manoeuvre. Sino-U.S. trade frictions will inevitably affect the Chinese economy and will not change the Chinese economy. Sustained healthy development of the good situation.
'At the same time, supply-side structural reforms and innovation activities have improved China's economic stability and resistance to risks, and China has the ability to respond to risks and challenges in order to maintain sustained and healthy economic growth. ' Xing Zhihong said that consumption is the economy of the past five years The main driving force for growth has played an important role in maintaining growth and reducing external influences. 'In recent years, China’s trade surplus has continued to shrink, and import growth has accelerated, reflecting strong domestic demand.'
■ Case Analysis
● Industry
Qualcomm is the core player of chips used in mobile phones and communications equipment
On the evening of April 16, the U.S. Department of Commerce announced that it was forbidden for U.S. companies to sell components to ZTE. This ban went into effect immediately for seven years. It was alleged that the U.S. Department of Commerce had determined that ZTE had made plans between 2016 and 2017. False statements involving 'the company claimed at the time that it was taking and the disciplinary actions it had taken against senior employees.'
ZTE Corporation started as a telecommunications equipment manufacturer and began to enter the mobile phone manufacturing field to expand the telecom operators' market. According to its 2017 annual report, operator-based network operator revenue accounted for 58.6% of total revenue. The proportion of consumer services based on mobile phone services was 32.4%.
Among them, the main demand for the mobile phone business for the chip is the AP processor, and the mobile phone and the communication device have a common demand for the LTE base. From the third party report, the core players in this market are Qualcomm, and from the perspective of the share, Qualcomm Both maintain the leading position in the market.
Two reports of Strategy Analytics show that in the first half of 2017, the smartphone application processor market, Qualcomm led 42% of MediaTek, Apple, Samsung LSI and Spreadtrum, and Qualcomm has room for further expansion; 2016 LTE baseband market, Qualcomm’s Market share reached 50%, MediaTek and Samsung LSI followed closely behind by 24% and 10% respectively.
In other words, at present, ZTE wants to carry out two core businesses, all of which are inseparable from Qualcomm's product supply. At present, domestic manufacturers do not have the ability to eat all their orders. The Beijing News reporter Liang Chen
●Impact
With no core pain, how much does the ZTE product line depend on the United States?
There is still no core pain in China's electronics industry. China Merchants Securities's electronic research team pointed out that ZTE's main businesses are base stations, optical communications and mobile phones. Among them, some RF components in base stations such as cavity filters, optical module manufacturers, and mobile phones The module of the structure, etc. can basically meet the self-sufficiency demand. Only the chip, in some of the three major application areas, has a certain degree of self-sufficiency. In the three major application areas of ZTE, the block with the highest chip threshold is the RRU base station. It takes a long time for the field to achieve domestic substitution.
According to Gu Wenjun, chief analyst of the core consulting firm, this has a major impact on ZTE. Although it wants to reclaim ZTE Microelectronics, it will be difficult to change the status quo within two years, that is, relying entirely on imports.
Gu Wenjun once analyzed in his article that the seemingly huge Chinese electronics industry is at the lowest point of the industry chain. Even though ZTE has more patents, most of the major chips and components are from American manufacturers. It is said in the article that only the chips ( Excluding a large number of components, ZTE has more than tens of US chip suppliers. Even more deadly, almost all segments of ZTE's products have US chips. And domestic chips are rare.
CICC analysts have analyzed this. There are two direct impacts on ZTE, communication equipment and mobile phones. Among the core components of communication equipment, some base stations have 100% components from US companies; ZTE has 1-2 Monthly stocking, if not settled within this time, will affect the production of ZTE's equipment. This will affect the telecommunication industry, especially the construction of China's operator networks, and affect future 5G construction.
In ZTE's revenue structure, the operator network accounted for 58.62%.
CITIC Securities believes that the short-term impact is significant. Because of ZTE's baseband chips, radio frequency chips, storage, and most of the optical components are from the United States, the short-term impact is significant. With the delivery of existing orders, new acquisition orders will be greatly affected. Delivery, payment will be affected, whether the client-side fine will be judged based on the disclosed further information due to delayed delivery.
ZTE issued an internal letter saying that the U.S. Department of Commerce has activated the refusal order of the company and the company has attached great importance to it. The company has set up a crisis response team at the first time. At present, all areas of the company are analyzing and formulating countermeasures to go all out and face the crisis. Beijing News Reporter Ma Wei Liang Chen
● Countermeasures
How does ZTE's 'remove move'?
After the incident, ZTE released a message on the official Weibo that the company has been informed of the US Department of Commerce’s refusal to activate the company. The company is fully assessing the possible impact of this incident on the company and actively communicates and responds to all aspects.
In this regard, Gu Wenjun analyzed that this incident was a case under a special background. The so-called special background was the trade friction between China and the United States. At this stage, both China and the United States are looking for chip-laden cards. Anything that can happen will happen. ZTE may be Grab the handle. This matter may eventually be resolved through negotiations, and will not be expanded for the time being.
From this point of view, Gu Wenjun said that ZTE’s first thing to do is to prove that the reasons for cross-examining the United States are not justified, and that they are trying to cut the bills. The second step is to rely on the communication of the Ministry of Commerce. Ultimately, ZTE may make some concessions. It's almost fine to accept fines because there are no counter-reversals.
Liu Qicheng, a communication expert, believes that ZTE can only react passively. Under the background of trade frictions, how much inventory does ZTE have to inventory? How much influence will it have on the next supply? How long will the impact cycle be? Communicate with other component manufacturers. There is no alternative product. '
Communication expert Fu Liang told the reporter that what ZTE wants to do now is to actively communicate and try to get the U.S. government to cancel or reduce these penalties. Such an operation is also unfavorable to the United States, and it is unfavorable to many U.S. suppliers, not only to ZTE, but also to ZTE. It also affects the U.S.’s own employment.
In recent years, it has become more common for Chinese companies to go to sea. The experience of ZTE in the United States has a lot to use for Chinese companies. Chinese companies must abide by the principle of international development in overseas development. In this Iranian incident, ZTE did not specifically think about it, but it caused serious consequences. Semiconductor industry analyst Wang Shuyi told reporters that if it is fully implemented, ZTE should not support it for three months, 'because some of the core things are now fundamental in China. There is no alternative. 'The Beijing News reporter Ma Yi Liang Chen
● Market
US technology stocks surprised, domestic chip concept shares rose 3%
The list of ZTE U.S. upstream suppliers compiled by CITIC Research shows that there are mainly three types of U.S. upstream U.S. companies, namely terminals, main equipment and servers, and optical devices, totaling 14 companies.
Affected by this news, Qualcomm, Micron, Broadcom, Intel, Oracel, and several companies of Oracel have not received significant stock price volatility due to the low proportion of ZTE's purchases. On April 16th, Qualcomm fell 1.72%, Micron fell 1.11%, and Broadcom rose 0.98. %, Intel rose 1.04%, Oracel rose 0.35%.
According to related media reports, 30% of ACIA's shipments were purchased by ZTE, ACIA's shares plunged 35.97%, Oclaro fell 15.18%, Lumentum fell 9.06%, fabrinet fell 9.81%.
Previously, ZTE stated that it will focus on 5G end-to-end solutions. It is expected that 5G commercial mobile terminals will be released by the end of 2018 or early 2019.
The flush showed that the 5G Concept Index fell yesterday, down 3.12%. At the same time, domestic chip concept stocks rose nearly 30%.
CICC analysts pointed out that semiconductors are relatively global industries. If they are directly limited to mainland semiconductors, the global industrial chain will be very large.
In fact, this move by the United States not only affects ZTE, but also is not good news for US companies to some extent. Wang Shuyi, an analyst at the semiconductor industry, pointed out: 'The United States can cut off supplies in the industry chain and force you to abide by them through broken supplies. The United States will force domestic companies to find domestic manufacturers to make domestic alternatives. In the long run, it may not be a good thing for them. '
Gu Wenjun said that no country in the semiconductor industry today can independently develop 100% of the chip industry. Even the United States cannot. The United States does not have the production of lithography machines, and it also needs to rely on imports.
Beijing News Reporter Ma Wei Liang Chen Intern Yang Ting
Sino-U.S. Trade Friction
In the early morning of March 23
President Trump officially announced the imposition of a punitive tariff of up to 60 billion U.S. dollars on various commodities in China.
March 23
The Ministry of Commerce issued a list of suspension and concession products for the US import of steel and aluminum 232 measures and solicited public opinions.
March 29
China informed the WTO of the suspension of the concession list and decided to impose tariffs on certain products imported from the United States in order to balance the benefits of the US 232 measures against the Chinese.
Midnight on April 1
China announced a 15% or 25% tariff on 128 products imported from the United States.
April 2
The Customs Tariff Commission of the State Council has decided to impose a tariff of 15% or 25% on 128 products imported from the United States since April 2, 2018.
April 3
The U.S. Trade Representative announced the 301 investigation tax proposal for China and publicly solicited opinions. The tax product proposal list will involve about 50 billion U.S. dollars of exports from China, and the proposed tax rate is 25%, covering about 1300 tariff lines.
April 4
The Ministry of Commerce of the People's Republic of China issued an announcement announcing that tariffs will be imposed on imports of soybeans and other agricultural products, automobiles, chemicals, and aircraft imported from the United States. The tax rate is 25%, involving about 500 Chinese imports from the United States in 2017 One hundred million U.S. dollars.
April 6
Advertising President of the United States, Trump, said that in view of 'China's unfair counterattack', he has instructed the U.S. Trade Representative Office to use the '301 investigation' to consider whether it is appropriate to impose tariffs on the additional 100 billion U.S. dollars of goods imported from China.
8 o'clock on April 6th
The Ministry of Commerce held a press conference. If the US announces a new list of 100 billion taxation products, the Chinese side has made full preparations. It will not hesitate to immediately counter vigorously. We do not rule out any options.
April 11
Trump said: I will not call it a trade war, because this is really a trade negotiation. If China is willing to further open its markets to American products, the two countries will have the ability to avoid trade wars.
April 12
The spokesman of the Ministry of Commerce said at the summit that some people in the United States would not misjudge the situation and advise the United States to recognize the general trend of the world and not to 'walk up the road'.
April 16
The U.S. Department of Commerce issued an announcement stating that the U.S. government has banned ZTE’s purchase of sensitive products from U.S. companies and claimed that ZTE had made false statements to U.S. officials.
April 17
The Ministry of Commerce issued an announcement and decided to implement temporary anti-dumping measures against imports of stilts originating in the United States.