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Illustration: Lazaro Gamio/Axios

China's ZTE is alive, escaping what once looked like a death sentence for repeatedly violating U.S. sanctions and being seen as a threat to national security.

The details: The deal requires a $1 billion fine for ZTE, plus $400 million in escrow to cover any future violations. ZTE will also have to "retain a team of special compliance coordinators" who answer to the U.S., and change its top leadership.

The big picture: Trump's broad tariffs against Chinese goods concern Beijing, but the Commerce Department going after ZTE — a state-owned enterprise in a strategic sector — hit a sore spot for the Communist Party.

  • P.S. "[ZTE's] fate has gotten caught up in a bigger web, including an upcoming summit between President Trump and North Korea’s leader and the success of an American telecom company, Qualcomm, which sells a large amount of semiconductors to ZTE and is awaiting Chinese approval of a deal to acquire a Dutch telecom firm that will help it build the next generation of wireless technology, known as 5G." [N.Y. Times]

Why it matters: China's successful negotiation to save the company could embolden it to try the same for Huawei.

  • Huawei has been banned from military bases due to national security concerns about espionage. It's back in the headlines this week after it was revealed Huawei accessed Americans' data via Facebook. [Go deeper on Huawei]

What they're saying:

  • Marco Rubio: "I assure you with 100% confidence that #ZTE is a much greater national security threat than steel from Argentina or Europe."
  • Chuck Schumer: "@realDonaldTrump should be aiming his trade fire at China, but instead he inexplicably aims it at allies like Canada, Mexico and Europe."
  • Sen. John Kennedy: "I’m sure ZTE makes a fine cell phone, but they’re a little too close to the Communist Party of China for my tastes."
  • Go deeper: The bipartisan blowback

What's next: A bipartisan hoard of senators have introduced legislationto reverse the ZTE deal.

Be smart: China has the leverage to take on the U.S., and it's smart enough to use it when it matters — as was the case with ZTE.

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Go deeper

Updated 59 mins ago - Energy & Environment

Bomb cyclone prompts blizzard warnings from Virginia to Maine

Computer model projection showing the intense storm off of Cape Cod on Jan 29, 2022, with heavy snow and strong winds lashing the coastline. (Weatherbell.com)

Blizzard warnings are in effect for 11 million people from coastal Virginia to eastern Maine as a historic winter storm is set to slam the Mid-Atlantic and Northeast beginning Friday.

Why it matters: The storm will bring hazards ranging from zero visibility amid hurricane force wind gusts and heavy snow, to coastal flooding that will erode vulnerable beaches and threaten property from the Jersey shore to coastal Massachusetts.

Updated 1 hour ago - Politics & Policy

Omicron dashboard

Illustration: Shoshana Gordon/Axios

  1. Health: Contact tracing fizzles across America — New clues emerge on long COVID — Omicron is finally burning out — It's very difficult to get access to antiviral COVID treatments — Axios-Ipsos poll: Omicron's big numbersAnother wave of death — FDA limits use of Regeneron and Lilly antibody treatments.
  2. Vaccines: Pfizer begins clinical trial for Omicron-specific vaccine — The shifting definition of fully vaccinated.
  3. Politics: Virginia AG says public colleges can't mandate COVID vaccines —Alaska governor joins Texas lawsuit over National Guard vaccine mandate — Navy discharges 45 sailors for refusing vaccine — Spotify to remove Neil Young's music after his Joe Rogan ultimatum — White House: 60M households have ordered free COVID-19 rapid tests.
  4. World: U.K. to lift travel testing requirement for fully vaccinated — Beijing Olympic Committee lowers testing threshold ahead of Games.
  5. Variant tracker
4 hours ago - World

Biden will move U.S. troops to Eastern Europe "in the near term"

President Biden boards Air Force One at Joint Base Andrews on Jan. 28. Photo: SAUL LOEB/AFP via Getty Images

President Biden said on Friday he plans to move U.S. troops to Eastern European and NATO countries “in the near term.”

Driving the news: “Not too many” U.S. troops, Biden added in remarks to reporters at Joint Base Andrew upon returning from a trip to Pennsylvania.