Boycott threats worry multinationals

Scott Tong Apr 22, 2008

Boycott threats worry multinationals

Scott Tong Apr 22, 2008


Kai Ryssdal: In Beijing today, China tiptoed back from the brink of international trade troubles. A foreign ministry spokesman said the government’s ready to move past a proposed boycott of a major French retailer.

France has been singled out ever since the Olympic torch relay went sour in Paris. Both sides have started to let their diplomats do the talking, but the talk of boycott’s been making multinationals nervous since they all want in on the massive Chinese market.

From Shanghai, Marketplace’s Scott Tong reports.

Scott Tong: Shanghai yuppie Li Yuzhang just bought a new T-shirt. It says “Tibet is, will, and always will be part of China.”

But he won’t be spending his money at Carrefour. The big box store stands as the most visible French brand in China.

Li Yuzhang: Carrefour may be an innocent victim here, but the boycott lets us express our emotions, to tell France we’re angry about the torch relay in Paris.

Angry that pro-Tibet demonstrators disrupted the relay and embarrassed Beijing, this is China’s nationalist backlash against its critics. Twenty million netizens have pledged online to boycott Carrefour starting next week. Louis Vuitton and L’Oreal are targets, too.

But there’s one very visible boycott opponent. Chinese wheelchair athlete Jin Jing carried the torch in Paris and had to wrestle it away from a pushy demonstrator. Here she is in a TV interview:

Jin Jing: I think the boycotts and protests against Carrefour and Louis Vuitton will actually hurt our own people because the employees of those stores are all Chinese.

For that, Jing has attracted online scorn. She’s been branded a traitor and other, more colorful, names.

Every day, 2 million Chinese shop at Carrefour’s 112 stores. Almost everything sold is made in China.

So far, the retailer says boycott talk has yielded little effect on its sales. Still, the French business community remains on edge, says Jean-Pierre Lehmann of the Swiss business school IMD:

Jean-Pierre Lehmann: China counts enormously as a market for a number of French companies in areas like luxury, like automotive.

It all makes for a touchy environment for multinationals. Already, torch relay sponsors Coca-Cola and others have pared back their marketing efforts.

Still, Jean Pierre Lehmann says boycotts often fizzle and it’ll be hard for Chinese shoppers to stay away from those ubiquitous Louis Vuitton bags.

Lehmann: The Chinese consumer is now becoming accustomed to nothing but the best — or if not the best, then at least a good copy of nothing but the best.

In Shanghai, I’m Scott Tong for Marketplace.

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