ZTE Stops Serving Pakistani Telcos After US Sanctions

ZTE has stopped serving its clients in Pakistan after it was punished by the US for violating its export control laws for selling telecom equipment to Iran.
While the future of ZTE’s contracts with Pakistani telcos is unclear, the ongoing projects have been halted as of today and telcos are currently on their own to manage and maintain the services and equipment provided by ZTE.

ZTE has all major telcos as its clients, including Telenor, Jazz, Zong, and PTCL.

Pakistani telcos, while speaking with ProPakistani, confirmed that ZTE is no longer offering them services and that they are not entirely sure about when ZTE will bring more clarity on the future of the contracts.

Most of the telcos have delegated the network management tasks to their in-house teams, but considering the fact that almost all telcos had outsourced their network to third-parties, a major workaround would be needed to make sure that customers are not impacted by the move.

It may be recalled that ZTE was found reselling US made equipment worth hundreds of millions of dollars to Iran, which is prohibited by the US. ZTE was faced with a fine of $1 billion, an export ban and ban on US suppliers selling equipment to ZTE for 7 years but settled the case with the US.

Later, the US alleged that ZTE had failed to hold up its end of the bargain by not punishing those responsible for the violation and reinstated the bans. ZTE stated that it had been doing all it could to honor its commitment to the US and said the country’s actions represented an existential threat to it.

While ZTE has promised talks with the US to resolve the situation, it could take anywhere from 3 to 5 months, and global operations are expected to be affected for longer than that time period.

The ban was expected to directly impact the company’s revenues and cause delays, missed shipments and canceled orders and now we’re seeing the fallout first hand with the ZTE scaling back its operations in various markets including Pakistan.

ZTE is China’s largest public telecom equipment manufacturer and had been gearing up for 5G launches across the world. The US ban is going to impact its revenue, market share and ability to maintain a competitive edge. Not to mention, the ban could even force the ZTE to lose its Android license for its smartphone vision.