On Thursday, China's Ministry of Commerce said the action against ZTE has caused market worries about the trade and investment environment in the US, and will ultimately undermine the US itself.

ZTE accounts for about 10 percent of the global telecom equipment market, and 30 percent of the Chinese telecom market, according to data compiled by China International Capital Corp, a leading investment firm.

It is also the fourth biggest seller of smartphones in the United States. In 2017, it recorded 108.8 billion yuan ($17.3 billion) in revenue, up 7.5 percent year-on-year.

The ban is the latest development in the US government's punishment of ZTE, after the company pleaded guilty in 2016 to violating sanctions by shipping telecom equipment to Iran and the Democratic People's Republic of Korea. ZTE has already paid $890 million in fines and penalties.