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China’s backlash against Western brands may be short-lived

Not everyone in the Chinese government wants to see H&M and other foreign companies canceled

- April 21, 2021

After the backlash in China for its previous comments on forced labor in Xinjiang, Swedish fast-fashion giant H&M issued a new statement on March 31, stressing the importance of the Chinese market. The company claimed to be “actively working on next steps with regards to material sourcing.”

Chinese social media remained unimpressed by this statement, which did not mention Xinjiang or retract the previous statements. The hashtag #H&M statement didn’t mention Xinjiang# quickly became a top-trending conversation on the Weibo social media site. China’s nationalistic tabloid the Global Times, which moderated the hashtag, commented in a pinned post that H&M “shows no sincerity at all.”

Some commentators have interpreted this boycott against H&M and other Western brands as orchestrated by the Chinese government, in retaliation for European sanctions against Chinese officials in Xinjiang. And it’s equally plausible that a few organizations such as the Communist Youth League (CYL), nationalistic media outlets and pro-government influencers used the incident for their own interests, and nobody could voice dissenting opinions due to the sensitivity of the issue.

But a full-blown crackdown on H&M is far-fetched. Here’s why not everyone in the Chinese government would like to see it happen.

Western nations sanctioned China. Chinese media made the most of the criticism over Xinjiang.

How the controversy started

Last year, H&M released a statement expressing concerns about human rights in its supply chain and claiming that it did not work with any garment manufacturing factories located in Xinjiang, or source products from that region. Dozens of other brands like Nike, Adidas, Burberry and Uniqlo made similar statements.

How did an old statement stir up the current controversy? A Weibo user with 170,000 followers claimed that this whole incident traces back to his March 23 post, which included screenshots of the statement and expressed his anger that H&M was “picking a quarrel.” The post caused a “butterfly effect” after two influencers with millions of followers retweeted the post and it eventually caught the CYL’s attention.

This post by the CYL, which appeared at 10:48 a.m. on March 24, officially pulled the trigger. It claimed that it was H&M’s “wishful thinking” that the company could do business in China while “spreading rumors and boycotting Xinjiang cotton”.

The CYL has been at the center of online nationalistic propaganda for years. The ability to mobilize young people for nationalistic expressions has become a central element of the CYL’s legitimacy within the Communist Party. A diverse army of propagandists, including official media, government social media accounts, content farms, influencers and various commercial companies, closely follow CYL messages to identify content that could bring traffic.

For official media and government social media accounts, gaining traffic fulfills the political mission to “occupy the online frontier.” For content farms and influencers, topics like the H&M backlash are perfect for monetizing attention without political risk. For commercial companies such as Baidu Map, which erased H&M store locations, the incident provides an opportunity to promote their products.

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In a word, multiple parties stood to gain by amplifying the H&M backlash, but none of them play a major role in policymaking regarding commerce and foreign investment. The H&M saga appears to be essentially a nationalistic social media campaign, raising people’s resentment toward “hostile foreign forces.”

But many in China are less keen on a full-fledged boycott

The brands involved include not only H&M but other popular companies. Nike and Adidas, for instance, account for nearly half of China’s sportswear market — Nike reported $2.3 billion in quarterly revenue in the region. And H&M does business with more than 250 factories in China. Kicking these foreign companies out of China would damage foreign investor confidence. And Beijing would seek to avoid a significant rise in unemployment and potential damage to the economy.

During the peak of the backlash, people were attacking shop owners and salespersons of the chain stores. Official media quickly condemned such actions and suggested that “no need to put workers in a difficult position.” On March 25, Premier Li Keqiang visited a German-Chinese joint venture in Nanjing and reaffirmed China’s commitment to global cooperation. Although planned well ahead of the H&M backlash, Li’s trip points to the potential economic costs of cracking down on Western companies for nationalistic purposes.

In addition, for brands like Nike and Adidas, close links with Chinese sports make it unlikely that official soccer and basketball administrations and national teams would try to replace them in the short term. China’s national soccer team, for instance, has a $183 million contract with Nike. The consequence for the 2022 Beijing Winter Olympics would also be huge if Nike and Adidas were banned.

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Even though China’s state censors have so far tolerated or even celebrated the campaign against Western brands over Xinjiang, there’s another reason that the Chinese government might seek to cool things down: The topic unwillingly opened up space for Xinjiang-related discussions. Weibo users found that they could finally use the word Xinjiang instead of coded phrases such as “xj” to avoid censorship. Some seized the opportunity to voice their support for Uyghurs.

In previous backlashes against Western brands like Versace and D&G, when they listed Hong Kong as a separate country from China or used racist materials, the companies eventually issued an apology. But foreign brands may be less likely to apologize this time due to strong public opinion and laws in their home countries.

In the long term, China’s domestic brands might enjoy an increasingly prominent position, and China may eventually be able to afford to cut ties with Western brands. But for now, the controversy seems likely to continue to simmer, but at a lower level. Some popular Chinese TV shows blurred images of Western logos on shoes and shirts, but probably not due to a government directive. It is just as likely that these TV channels proactively censored the brands to avoid political backlash from audiences.

Still, these flare-ups may be short-lived. Within a week, Weibo users in different cities across China posted pictures of H&M stores returning to normal. One post noticed that most hashtags related to the H&M boycott stopped showing new posts since the end of March, and that official media had also turned away from this issue.

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Kecheng Fang is assistant professor in the School of Journalism and Communication at the Chinese University of Hong Kong.