Cook's visit a vote of confidence in China

Apple CEO Tim Cook's latest trip to China, like his many previous trips to the country, has again trended on Chinese social media. From attending the opening ceremony of a new retail store in Jing'ansi Square in Shanghai, to hosting an information-sharing session with Apple's suppliers, including Chinese electric vehicle maker BYD, Cook was warmly welcomed, in contrast to the bullying some Chinese companies have faced in the United States. 

Cook will also participate in the China Development Forum's annual meeting scheduled for yesterday and today. In addition to Cook, the event is expected to draw more than 110 foreign guests, including representatives of international organizations, corporate executives, and well-known scholars. 

This is Cook's third visit to China in one year. Cook has visited China more than 20 times since 1996, making him one of the most frequent visitors to China among multinational executives. Cook and other foreign tech executives flock to China because they value China's complete supply chain and vast market, especially against the backdrop of increasing geopolitical risk in the world. As Cook put it Wednesday, "For Apple's supply chain, I think there is no place more important than China." He also promised to invest more in China.

Cook's visit comes at a time when Apple's iPhone sales plunged in the country, making some overseas media depict Cook's ongoing trip as a "charm offensive." 

In the past few years, Washington's push for "decoupling with China" has put pressure on Apple. Apple is the biggest tech company in the world by market capitalization, a big portion of whose manufacturing and sales both have depended on China. The company is backed by a huge industrial supply chain.

For some time now, there have been rumors that Apple is "moving its industrial chain out of China." A Japanese research company disassembled the latest iPhone 15 Pro Max and found out that the parts and components provided by manufacturers from the Chinese mainland accounted for only 2% of the cost. Every bit of the fall of Apple's sales in China has triggered hype that wants to create an impression that Apple is "not popular" in China and that China's business environment "lacks stability." 

In his recent remarks in China, Cook mentioned that after three decades of quick progress, China's factories have now achieved a high level of modernization, with very advanced manufacturing capabilities and well-trained workers. As an observer, he can see clearly that Chinese manufacturing is no longer just about processing and assembly; it is increasingly moving toward upstream design and research and development, which is precisely the area where the value-added modern manufacturing is most concentrated. For example, components from Chinese mainland manufacturers account for 60% of the latest Apple Vision Pro headset. It can be said that the relationship between Apple and China's supply chain is mutually beneficial.

Nvidia, which has been highly sought after in the market due to the AI boom, too has a clear understanding of this. Nvidia CEO Jensen Huang recently stated in an interview, "Many components of our chips are produced in China, which is consistent with the complexity of the global automotive supply chain. It is difficult to break the globalization of the supply chain." Regardless of how external opinions may criticize it, the strength of the Chinese market and supply chain is evident; and more importantly, China's commitment to opening up to the world has always been consistent.

In contrast, the United States has been trying to shut its door.

A bipartisan group of U.S. lawmakers demanded higher tariffs on Chinese-made drones, while some lawmakers expressed "concerns" about Microsoft's Bing search engine operations in China. Officials from the U.S. Department of Commerce claimed that Chinese chipmaker SMIC "may have violated the law," and there were rumors that the Biden administration is considering sanctions on chip producers related to Huawei. 

China is vast, and the Pacific Ocean is wide. There is ample space to support the mutual development of China and the U.S. Both Cook and Apple have established a sustainable and win-win relationship with China. 

Globally, China's market is widely recognized for its commitment to openness and the efforts to create a fair and favorable business environment. Multinationals have voted the Chinese market with the visits from their executives and future investment plans as a favorable location for business.

(Global Times)