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Adidas Deal Gets Chinese Basketballer in Trouble

One of the Chinese Basketball Association’s (CBA) up-and-coming players appears to be facing financial consequences after signing with Adidas.

Hu Mingxuan, the 23-year-old recipient of this year’s CBA Finals MVP award, announced his partnership with the German sportswear giant late last month on Weibo, China’s version of Twitter. The alliance quickly inspired criticism among the same state media outlets that lashed out at Adidas and other Western companies in March for their statements expressing concern over reports of forced labor in the Xinjiang Uyghur Autonomous Region.

The Global Times—a tabloid published by the People’s Daily, the Chinese Communist Party’s official newspaper—claimed last week that Hu lost 20 percent of his champion bonus as a penalty for signing with Adidas. Citing “local media reports,” the state-sponsored publication said the guard’s team, the Guangdong Southern Tigers, have since introduced a new rule requiring that players seek approval from the club before signing as a spokesperson for a foreign brand. If they don’t, they could lose 50 percent of their salary and face a 15-game suspension.

In March, as public outcry in China against brands that had spoken up against the use of Xinjiang cotton reached a fever pitch, celebrities fled Western brands like Nike, H&M and Adidas in droves.

In mid-April, China Market Research (CMR) analysts Kerstin Brolsma and David Liu reported that store checks conducted in China had shown traffic down 20 percent to 50 percent at Nike and Adidas stores. At the time, Brolsma said CMR had observed a bounce back in traffic at Nike stores. She estimated the company would return to its pre-boycott levels in two to four months. However, she predicted a tougher time for Adidas.

“This incident has illuminated some of the other problems Adidas was already facing in the China market and so I think because Adidas right now does not have a good grasp of who their target customer is, nor, after all of their spokespeople have cut their contracts, they don’t have a good way to easily shift their advertising model,” Brolsma said. “So, I think Adidas is up for a much harder road ahead than Nike.”

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This prediction seems to be holding true. In the three months ended May 31, Nike saw sales grow 9 percent in Greater China on a currency-neutral basis. During the period ended Aug. 31, the Oregon-based company registered a 1 percent increase in sales.  Adidas, meanwhile, saw its revenue in the region drop 16 percent year over year in the three months ended June 30.

The environment that prompted March’s boycotts is unlikely to change anytime soon. Though much of this spring’s outrage centered around what Western companies had said regarding Xinjiang cotton, most of these statements had been published months earlier. Days before the boycott calls began, however, the United States, Canada, the European Union and the United Kingdom announced sanctions on several Chinese officials for what they described as human-rights abuses against Uyghurs, Kazakhs and other Turkic Muslim minorities in Xinjiang. Secretary of State Antony Blinken characterized China’s actions in the region as “genocide” and “crimes against humanity.”

The Biden administration’s stance on Xinjiang has not changed much since March. Just this Friday, the president delivered a speech on human rights in which he compared the forced labor of the Uyghurs—authorities are widely believed to be holding more than a million ethnic minorities in detention camps or coercive employment schemes—to the Holocaust and other atrocities.

“Nuremberg forced us to look closely at the evil of humankind and what we’re capable of perpetrating, to see mass atrocities, crimes against humanity do not happen by accident,” President Biden said. “And sadly, when we look around the world today, we cannot say that the specter of atrocity is behind us.

“We see today the patterns, the choices playing out around the world even as we speak: the oppression and use of forced labor of the Uyghurs in Xinjiang; the treatment of the Rohingya by the military junta in Burma; the rampant abuses, including the use of starvation and sexual violence, to terrorize civilian populations in Northern Ethiopia,” he continued.

At the same time, Biden is attempting to take a firm stance on Xinjiang, it is also looking to negotiate with Beijing on trade. Earlier this month, Katherine Tai finally unveiled the “the starting point of our administration’s strategic vision” for China. Though the United States Trade Representative’s speech threw cold water on hopes for a quick end to tariffs imposed under former President Donald Trump, it did reveal plans to reopen the tariff exclusion process and initiate a fresh round of talks with China. At the time, Tai said she intended to begin “frank conversations” with her counterpart in China “in the coming days.”