Did Trump Vow to Help a Chinese Phone Maker After China Approved Money for a Trump Project?

The timing of President Trump's statement about wanting to help ZTE raised eyebrows.

  • Published 16 May 2018

Two days before United States President Donald Trump took the unusual step on 13 May 2018 of announcing plans to help save jobs in China, reports surfaced that the Chinese government would back a development project in Indonesia featuring Trump-branded properties to the tune of $500 million.

A 11 May 2018 article by news outlet Agence France-Presse (AFP) reported that a subsidiary of MCC, a construction firm owned by the Chinese government, had that week been selected to contract on MNC Lido City, a theme park project being built roughly 40 miles outside Jakarta by an Indonesian firm. The project is expected to have financial backing from the Chinese government:

A billion-dollar Indonesian property development with ties to US President Donald Trump has become the latest project in China’s globe-spanning Belt and Road infrastructure project – just as Washington and Beijing are tussling over trade.

A subsidiary of Chinese state-owned construction firm Metallurgical Corporation of China (MCC) signed a deal with Indonesia’s MNC Land to build a theme park outside Jakarta as part of the ambitious project, the company said on Thursday.

The project includes Trump-branded hotels, residences and a golf course, as well as other hotel, shopping and residential developments.

The deal is the latest to raise questions about the extent of Trump’s financial exposure to Beijing.

Two days after the article was published, President Trump posted a message on Twitter that resulted in flurry of news stories questioning the timing of the statement, or even questioning flat-out whether he had been bribed:

  

As of 16 May 2018, MNC officials, including top executive Hary Tanoesoedibjo, denied that any loan deals with China had been signed.

However, according to MNC company materials and Indonesian news reports citing statements by MNC officials, the project has since at least 2016 banked on Chinese loans from the state-owned Chinese Export and Credit Insurance Corporation (Sinosure). AFP reported that the project could see up to $1 billion in backing from the Sinosure and Chinese companies. The Trump Organization has been signed on the develop a luxury hotel and golf course on the resort since 2015.

Trump’s statement in light of Chinese involvement with the project and potential funding prompted some to question whether an investigation was in order.

“It looks like a bribe to me,” said Richard Painter, who served as White House ethics lawyer for George W. Bush and is now running for a Senate seat in Minnesota as a Democrat. Painter added:

He got what he wanted out of the Chinese government — a major development deal, and within a day or two he’s talking about bailing out this company the Chinese government wants bailed out. It’s circumstantial evidence of a quid pro quo.

According to its web site MNC Lido City will feature “the first ultra-luxurious Trump International resort in Asia.” It’s part of Belt and Road, an ambitious international infrastructure development being lead by the Chinese government that builds on and expands the idea of the Silk Road, an ancient trade route that connected Asia, the Middle East, Europe and Africa. The project aims to build a network of new and farther-reaching roads and maritime routes.

In April 2018, the Commerce Department censured ZTE for violating sanctions against North Korea and Iran and then lying to the United States government about doing so. Commerce slapped ZTE with a seven-year censure that prevents them from purchasing key components from American manufacturers that the company needs to stay competitive. A question we sent to the Commerce Department on the issue was not answered.

In early May 2018 the Pentagon announced devices made by ZTE and Huawei would no longer be sold on U.S. military bases because they created a security risk. Major Carla Gleason, a Department of Defense spokeswoman, told us the Pentagon has no current plans to change course. 

Amid backlash, Trump appeared to back off, criticizing the news media as he often does, and claiming his comments about ZTE hinted at a broader deal with China in the run-up to trade talks:

But it was not enough to satisfy critics such as Painter, who says that the House and Senate judiciary committees should open investigations. The clear message to China, he said, “is we’re going to bash you on trade but if you do business with the Trump Organization, everything’s cool.”

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