'ZTE loses Italy deal even as United States restrictions start to ease'

China’s ZTE names new leaders to comply with US deal

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Li Ying will also serve as chief financial officer.

On Thursday ZTE removed its CEO and appointed the former ZTE Germany director Xu Ziyang as the new leader.

ZTE earlier removed its 14-member board of directors and top management to lift a 7-year ban imposed by USA on China's second largest telecom equipment maker on sourcing tech from US-based companies.

ZTE has promised to change its top management within 30 days of agreeing a $1.4 billion settlement with US authorities in June.

New leadership was one of several conditions in an agreement struck between ZTE and the U.S.to end a ban on technology purchases that crippled its business.

ZTE, which relies on US suppliers for core components, had to cease major operations in April after authorities imposed the ban, saying the firm broke an agreement to discipline executives who conspired to evade USA sanctions on Iran and North Korea.

The easing of restrictions did not come soon enough for ZTE's bid to win a contract in Italy to supply wireless equipment to Wind Tre SpA.

The mixture of good and bad news is just the latest chapter in the saga of ZTE, which has seen its prospects and stock price rise and fall in the past few months over access to technology it needs to sell telecoms gear across the globe. It has 90 days to fulfill its other obligations.

In April, ZTE was banned from importing phone parts from the USA for repeatedly misleading the Commerce Department's Bureau of Industry and Security.

As ZTE scrambles to meet all the demands, its business continues to suffer. ZTE shares in Hong Kong rose about 2% and Ericsson gained as much as 1.1% in early trading in Stockholm.

However, the assistance offer has drawn widespread criticism from lawmakers in both parties, who warn that ZTE poses a national security threat.

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