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H&M, Nike and Adidas in trouble in China
Sweden’s H&M, the world’s second-biggest fashion retailer, is facing a furious backlash from Chinese internet users — egged on by state media — who just learned that the company had stopped sourcing cotton from Xinjiang since last year over allegations of forced labor in the region.
The online furor erupted when the Communist Youth League of China (CYLC), the youth division of China’s ruling party, today lambasted H&M for issuing a letter saying it was “deeply concerned” by reports on “forced labor and discrimination of ethnoreligious minorities in Xinjiang.”
- The letter was issued last year by H&M, so it’s not clear why the CYLC went on the attack today, except as one piece of a broader party-state attack on Western criticism of China’s policies in Xinjiang.
- Chinese social media, sometimes egged on by state media and Party-affiliated organizations, has a long history of directing nationalistic outrage at foreign companies over perceived slights related to Hong Kong, Taiwan, and Tibet. However, this appears to be the first time a major backlash to a foreign company has been centered on Xinjiang-related allegations.
- Whatever the reason for the timing, the CYLC wrote in a post (in Chinese): “Spreading rumors to boycott Xinjiang cotton, while also wanting to make money in China? Wishful thinking!”
- The post included screenshots of H&M’s letter.
- In another post (in Chinese), the League urged H&M to “stop spreading false information” and “take off its colored glasses.” “Chinese people won’t swallow this,” it wrote, referring to remarks made by China’s top foreign policy official, Yáng Jiéchí 杨洁篪, who had became a favorite of Chinese internet users after his combative performance at the U.S.-China meeting last week in Alaska.
A vast number of Weibo users have called for a boycott of the Swedish fast-fashion chain, which operates over 400 stores in China.
- “No, H&M, you can’t have it both ways. You either show some respect for us, or you are facing a boycott,” said (in Chinese) an angry Weibo user. Another one wrote (in Chinese): “I can’t boycott H&M anymore. I haven’t shopped there for years because its clothes are crappy.”
- Topics, hashtags, and posts related to the controversy have been dominating Weibo all of today. The main hashtag associated with the issue, “Snow-white cotton in Xinjiang” #新疆雪白的棉花#, has been viewed more than 200 million times, with thousands of comments calling for the retailer to shutter its Chinese stores and leave the country entirely.
Other international apparel brands, including Nike and Adidas, are also under attack due to their affiliation with the Better Cotton Initiative (BCI), a major international cotton sustainability organization, which suspended licensing of farms in Xinjiang last year due to concerns about the use of forced labor in the region.
- Commenting on a Weibo post that listed all the foreign brands that are members of BCI, a person wrote (in Chinese), “We need to hold every one of them accountable. None of them will get out of this undamaged.”
- Facing growing public pressure, Anta Sports, a Chinese sports apparel manufacturer, has released a statement (in Chinese) on Weibo saying that it would quit BCI and that it had always used Chinese cotton.
The anger has been nurtured by Chinese state media, which actively publicized the idea of a boycott, and encouraged consumers to purchase other products made of Xinjiang cotton.
- “As an international enterprise, H&M is supposed to show more respect for its customers. A brand is bound to be abandoned by its users once it hurts their feelings,” said (in Chinese) the People’s Daily in a Weibo comment. “Cotton picked in China’s Xinjiang is immaculately clean and flawless. We’ll protect it from slander and false accusations. Although the Chinese market is huge, we don’t welcome people who make malicious attacks.”
- China Central Television (CCTV), China’s state broadcaster, coined and has been trying to popularize several slogans based on H&M’s name, such as “H&M is ridiculous” (H&M太荒谬) and “No one will pay for lies” (没人为谎言买单).
- In a video (in Chinese) that has garnered more than 6 million views on Weibo after it was uploaded yesterday by China Global Television Network (CGTN), a cotton farmer in Xinjiang denies allegations of forced labor, stating that the process of cotton production has basically been mechanized, and that there was no need for a large number of cotton pickers. Most comments under the video accuse Western media and human rights activists of spreading lies and disinformation.
A host of Chinese celebrities were quick to cut business ties with H&M today.
- Sòng Qiàn 宋茜, H&M China’s brand ambassador, wrote on Weibo (in Chinese) that she no longer wanted to be associated with the brand, stating that “national interests are above all else.”
- Heartthrob actor Huáng Xuān 黄轩 announced (in Chinese) that he had severed ties with the brand via his agency’s official Weibo page, although a source told WWD, a fashion industry magazine, that Huang’s ambassadorship in fact “had ended some time ago.”
There are indications that H&M will suffer serious financial repercussions because of the backlash.
- The brand’s products have been removed from all major Chinese ecommerce platforms, including Taobao, JD.com, and Pinduoduo. Its app has been removed from app stores of Chinese phone companies, including Huawei, Xiaomi, and Oppo. The company’s retail locations also appear to be blocked in navigation platforms like Baidu Map and AutoNavi.
- H&M has 449 physical stores across China as of August 2020, and has plans to expand online sales.
- The Chinese market often contributes to a significant portion of international apparel companies’ revenues, including H&M and Nike. In 2019, China was H&M’s fourth-largest revenue source — generating $1.25 billion for the company. Nike sold $9.35 billion in the greater China area in 2020, nearly 20% of the sports company’s total annual revenue.
- China is the world’s largest apparel supplier, accounting for over 30% of global clothing exports. Xinjiang, a major cotton production region that is also a center for the textile industry in China, supplies more than $20 billion worth of garments in retail price to American brands and retailers, according to the Workers Rights Consortium.
Chinese consumers won’t pay for multinational companies’ political correctness that caters to West
On Wednesday night, sports brand Nike became a trending topic on China’s Twitter-like Sina Weibo. Netizens found the company’s statement from last July which said “Nike does not source products from the XUAR (Xinjiang Uyghur Autonomous Region) and we have confirmed with our contract suppliers that they are not using textiles or spun yarn from the region.”
As the saying goes, you will always reap what you sow. After more than half a year, Nike has finally paid the piper. It is losing its reputation in the Chinese market.
Chinese netizens have the right to look for and expose Western companies’ offensive statements regarding Xinjiang affairs. It is their right to express anger. Every country and market has its interests and self-respect. At a time when the ideological conflict between China and the West is seriously intensifying, it is destined to become difficult for multinational companies. They will be challenged to maneuver and balance between different markets. But it is not the Chinese side to shoulder this responsibility.
You cannot ask Chinese side to step back and spare those companies so that they can be “politically correct” in the West — all the while leaving Chinese consumers with damaged dignity. Chinese netizens denouncing those Western companies is a normal reaction of any consumer group, particularly when they feel deeply offended.
The ideological conflict between China and the West will be a long-time struggle. The West has various methods to discredit the Chinese government. But it lacks tactics to deal with Chinese public opinion. From the perspective of morality, what they are most fearful about are powerful Chinese grassroots voices.
China must not only further its opening-up but also stick to principles to safeguard its interests and dignity. We welcome foreign companies to enter China. But they must act with respect to China. The demand is simple and just. Those companies need to comply with local rules and customs. The rules and habits that they follow when they are in the West need to interact with the principles of the Chinese society, from this, they can then make adaptations.
Statements from companies including H&M and Nike made to the Western audiences clashed with the Chinese public’s attitudes. I don’t think we should define such a clash from a political perspective. We should view it as a market process. This is something that the companies cannot evade to win favor from consumers. We should let the laws of the market determine the outcome of the collision.
Western extreme forces are eager to define natural reactions from the Chinese market to external offenses as “political suppression.” We cannot allow them to dominate international perceptions of these conflicts and stigmatize China’s investment environment. All multinational enterprises should stay away from geopolitics. It is the West that has forced multinational enterprises to politicize the supply chain issue and pushed them to offend Chinese consumers and the market. It is inevitable that they will be punished by the market. This is the real logic, and we need to make it crystal clear to the world public.
Many foreign companies have been denounced by Chinese netizens. It is in no way contradictory to China’s expanding opening-up. H&M, Nike and others are now suffering heavy losses to their reputations in the Chinese market. Enormous investment in public relations has been destroyed instantly. They need to return to the Western society to complain, because they know that for whatever reason, whether they are active or passive, they have indeed done something that is intolerable to Chinese consumers.
Source: Global Times