Firms caught in China dispute
China pressures companies not to list Taiwan separately on their websites.
Beijing is pressuring Apple, Nike and other companies not to list Taiwan separately on its websites.
Chinese authorities are pressuring 66 multinational companies, including American icons Apple and Nike, to refer to self-ruled Taiwan as part of China, a demand expected to drive a new wedge between two governments that already struggle to get along.
The change would send a message to Taiwan that major companies regard it as part of Chinese territory. Most Taiwanese say they prefer today’s autonomy, but the more economically powerful China says Taiwan belongs under its flag.
The companies would probably comply by linking Taiwan to China on storefinder websites and in descriptions of their international operations, analysts in Taipei said. They’re all among the world’s top 500, and many do business in China.
“At this point, to struggle against the hearts of Taiwan’s people is unhelpful and can instead be harmful,” said Andy Chang, China studies professor at Tamkang University in Taiwan. “These companies are not government organizations, so for mainland China to demand they take a crystal clear position on politics, of course, doesn’t form a good image among Taiwan’s people or internationally.”
The mandate to companies, noticed this week by the Taiwan government, follows a similar request last year of 44 international airlines. Despite protests from foreign governments, including the United States, most airlines met China’s final July 25 deadline by ensuring their booking websites did not imply Taiwan is separate from China.
China made the most recent requests in its 2018 Blue Book on the Cyber Rule of Law, which threatens penalties against multinationals that don’t comply, Taiwan’s Foreign Affairs Ministry said Thursday.
China and Taiwan have been separately ruled since the Chinese civil war of the 1940s, when Chiang Kaishek’s Nationalists lost to the Communists and moved their base to the island. China insists that the two sides eventually unite.
Chinese President Xi Jinping called this month for a unification scheme that gives Taiwan some local autonomy, but Taiwan President Tsai Ing-wen rejected that idea as well as Beijing’s condition that the two sides sit down for talks as parts of one China. Beijing has used military aircraft flybys and diplomatic pressure to make Tsai accept that condition since she took office in 2016.
“The further they push us, the further away we get,” Taiwanese legislator Lee Chun-yi said.
Making companies list Taiwan under China headings on websites will further hurt relations between the two governments, the ministry said. More than 70% of Taiwanese in government polls since 2014 say they prefer self-rule over unification.
The ministry urged multinationals to resist Chinese pressure. “China’s moves to impose its executive and judicial jurisdiction as well as political ideology on foreign companies not only expose its malicious intent in using political tactics to interfere with private enterprises, but also violate the spirit of free international commerce,” the ministry said in a statement.
Young people in China and Taiwan, who already trade harsh language online, might get even angrier now, said Joanna Lei, head of the Taiwan-based Chunghua 21st Century think tank.
The airlines adjusted their websites over a period of about six months. They valued China’s civil aviation market, which the International Air Transport Assn. expects to become the world’s largest by 2024 with more than 1 billion passengers per year.
Apple has seen its coveted smartphone market share in China fall below 10% since the second quarter of last year, according to data from Counterpoint Research. Nike would fret about holding onto $1.5 billion in China sales in the 201718 financial year, up from $1.1 billion in the previous year, according to the ISPO sports business network.
China probably expects more political gain at home than from Taiwan, Chang said. Its own citizens want stronger action on China’s offshore relations as the country has lost ground with the U.S. in trade over the last year, he said.
Companies named by China will probably take longer than the airlines did to relabel Taiwan, said Liang Kuo-yuan of the Taipei research firm Polaris Research Institute. U.S. officials could use the trade dispute as leverage to protest China’s demands, he said, but eventually “I believe these private companies will, of course, make the adjustments.”