The Australian arm of Chinese telecoms giant Huawei is ending its sponsorship deal with the Canberra Raiders, the Australian Rugby League, a year early because of poor business due to a “negative business environment”, the company has said. The announcement underscores huawei’s beleaguered position at a time of strained relations between Australia and China.
Huawei’s Australian arm said on Monday that it would end its sponsorship earlier than expected at the end of the year because “the continued negative business environment has impacted our planned revenue stream more than originally anticipated”.
Huawei is the main sponsor of the Canberra Raiders, whose logo and company name are emblazoned on the front of the team’s soccer gear and jerseys. The original sponsorship deal would have lasted through at least the 2021 season.
Jeremy Mitchell, head of public affairs for Huawei Australia, said in a statement that the company managed to find resources to continue sponsoring the company even after its 5G network equipment was shut out by the Australian government, but that it could no longer provide financial support. Huawei’s name will also appear at the team’s training center and on the back of the players’ jerseys, the statement added.
Dennis Richardson, a member of the Board of the Canberra Raiders, is a former undersecretary of defense and head of the Australian Security Intelligence Organization. Mr. Richardson has been a strong supporter of Huawei’s sponsorship of the team.
Monday’s announcement comes amid deteriorating relations between Australia and China. Relations between the two countries have soured since the Australian government, under Prime Minister Malcolm Turnbull, banned Huawei from supplying Australia’s 5G mobile network in 2018, citing the risk of foreign interference and hacking, a decision that angered Beijing.
This year, Australia joined the United States in calling for an independent international investigation into the novel Coronavirus outbreak that began in Wuhan, China. China subsequently took various retaliatory measures, and Australia-China relations fell to a low point.
China first slapped punitive tariffs of up to 80 per cent on Australian barley and then halted imports by Australia’s three main beef exporters. Later, China issued a warning on the grounds of racist attacks in Australia and discouraged Chinese tourists and students from coming to Australia, exerting pressure on Australia from both education and tourism.
China then turned its sights on Australian wine. China’s Ministry of Commerce announced on August 18 that it had launched an investigation into whether Australia was dumping cheap wine into the Chinese market. Australia denies this and says its wines are not sold below market prices and there are no export subsidies. Australia sees this as a retaliatory move by China against Canberra’s proposal for an international independent investigation into the source of the novel Coronavirus. A week later, the Australian government announced it would recommend blocking the sale of a former Australian beverage company to a Chinese company by Japan’s Kirin Holdings. The decision also upset Beijing.
In addition, Australia has supported democracy movements in Hong Kong and accused China of territorial expansion and militarization in the South China Sea, both of which have upset Beijing.
Australian Prime Minister Scott Morrison has said he will not be intimidated by China or give in to coercion to change his values in response to multiple retaliatory moves.
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