Sunday, July 25, 2021

Nike boss assures Chinese consumers his company is ‘of China and for China’

His comments came after the sportswear giant was recently hit by a backlash over statements about Uighurs and cotton production in Xinjiang.

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The boss of sneaker manufacturer Nike has made a robust defence of the firm’s business in China after facing a boycott by millions of consumers there.

In response to a question about competition from Chinese brands, chief executive John Donahoe insisted, “Nike is a brand that is of China and for China.”

He was speaking during a call with Wall Street analysts about Nike’s latest earnings report.

His comments came after the sportswear giant was recently hit by a backlash over statements about Xinjiang.

Nike’s fourth quarter earnings showed world revenues had doubled to a better-than-expected US$12.3 billion for the three months to the end of March which helped it bounce back to a US$1.5 billion profit, from a US$790 million loss during the depths of the pandemic in 2020.

The figures also showed that Nike’s revenue in China rose to more than US$1.9 billion but missed Wall Street expectations of US$2.2 billion.

Donahoe said he remained confident that China would continue to be a fast-growing market for Nike due to its many years of investment in the country, saying, “We’ve always taken a long-term view. We’ve been in China for over 40 years.”

Nike’s co-founder and former chief executive had seen the potential for growth in the country.

“Phil Knight invested significant time and energy in China in the early days and today we’re the largest sports brand there,” Donahoe said.

The company’s shares rose by more than 14% during after-hours trade in New York.

Several Western brands, including Nike and Swedish fashion retailer H&M, recently faced a backlash from Chinese shoppers after the firms expressed concerns about the alleged use of Uighur forced labour in cotton production in Xinjiang.

Xinjiang, China’s biggest region, produces about a fifth of the world’s cotton. An autonomous region in theory, in reality it faces restrictions which have increased in recent years.

In December, the BBC published an investigation based on new research showing China was forcing hundreds of thousands of minorities including Uighurs into manual labour in Xinjiang’s cotton fields.

In March, a group of Western countries imposed sanctions on officials in China over rights abuses against the Muslim Uighur minority group.

The sanctions were introduced as a coordinated effort by the European Union, Britain, the US, and Canada.

In recent decades, mass migration of China’s ethnic majority Han Chinese to Xinjiang has fuelled tensions with Uighurs which has at points flared into deadly violence.

This has resulted in a massive security crackdown and an extensive state surveillance programme, which critics say violate Uighur human rights. China says such measures are necessary to combat separatism and terrorism.

Uighurs have been detained at camps where allegations of torture, forced labour and sexual abuse have emerged.

China has denied these claims saying the camps are “re-education” facilities aimed at lifting Uighurs out of poverty.

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