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Trade war

Chinese companies rally around Huawei after CFO arrest

Businesses also urge employees to boycott US rival Apple

Chinese companies are coming to Huawei's side by providing employees with subsidies to buy products from the smartphone maker.   © Reuters

BEIJING -- A growing number of Chinese companies are throwing their support behind Huawei Technologies following the recent arrest of its chief financial officer in Canada, taking such steps as offering subsidies for staff who buy the telecom equipment maker's smartphones.

Many Chinese businesses have told employees they will receive subsidies if they buy Huawei smartphones to aid the company. Most are subsidizing 10% to 20% of the purchase price, with some even covering the full amount. Over 20 Chinese companies also took to social media to announce that they will increase purchases of other Huawei products, such as its business management system.

The show of support has been broad, from information technology providers to food companies. A regional government official said that several hundred businesses were conducting such programs nationwide.

Electronics maker Shanghai Youluoke Electronic and Technology is fully subsidizing up to two Huawei smartphones per employee, while display equipment maker Shenzhen Yidaheng Technology will cover 18% of the price for Huawei or ZTE units. Fuchun Technology, a communications service company listed on Shenzhen Stock Exchange announced on social media on Dec. 11 that it would give each of its 200 employees who buy Huawei's smartphone before the end of 2018 between 100 and 500 yuan ($14.5 to $72.5).

At a brewer in Henan Province, employees and customers who present their receipt for a Huawei device receive free alcohol worth 30% of that purchase.

Huawei CFO Meng Wanzhou was arrested Dec. 1 in Vancouver by Canadian authorities at the request of the U.S. Meng, daughter of Huawei founder Ren Zhengfei, is suspected of misleading financial institutions about transactions in Iran that violate U.S. sanctions. The Chinese Foreign Ministry and Huawei have called the arrest wrongful, and they continue to protest against Washington and Ottawa.

Communist Party guidance has encouraged the corporate support for Huawei. The Communist Youth League has posted articles on social media urging companies to subsidize Huawei products.

Other companies are boycotting Apple, which is battling with Huawei for second place among the world's smartphone producers.

A machinery maker in Shenzhen, where Huawei is based, threatened to confiscate Apple devices from employees and fire those who did not comply. Menpad, a Shenzhen-based tech company, said it would punish employees who buy Apple products. Finally, Shenzhen Yidaheng Technology said it would fine staffers who bought iPhones the equivalent amount of their device, while other companies threaten to withhold bonuses.

A Chinese court also banned the sale of older iPhones in the country on Dec. 10, in a claim brought by Qualcomm. But Hu Xijin, the editor-in-chief of Communist Party mouthpiece Global Times, has said he will continue to use his iPhone.

Chinese consumers often boycott companies from nations whose relations with Beijing have soured. Stores belonging to Japanese companies were destroyed in 2012 during protests over the Senkaku Islands, which Beijing claims and calls the Diaoyu.

South Korean businesses like Hyundai Motor and Lotte faced boycotts last year over Seoul's deployment of a U.S. missile defense system.

According to Chinese media, a Shanghai-based business association said it would expel anyone who bought Apple products, sparking debate on social media over whether such nationalism went too far.

Akihide Anzai, Nikkei staff writer, contributed to this story.

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