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U.S. smackdown of ZTE proves Xi’s point

Symbol of ZTE on white wall at a company event in China
Photo: Paco Freire/SOPA Images/LightRocket via Getty Images

The U.S. Department of Commerce may have issued a corporate death sentence to Chinese telecom equipment maker by banning American firms from selling to it for 7 years. The company condemned the ban today, but the U.S. is unlikely to reverse its decision.

The big picture: While the company may end up crippled, the episode has strategic and propaganda value for Beijing. The timing of the announcement — right before the 2nd anniversary of an important speech on cybersecurity and technology made by Chinese President Xi Jinping — only serves to strengthen the point he's been making about the need to reduce reliance on foreign, and especially American, technologies.