While China is one of the most popular iPhone markets for Apple, it seems that the Southeast Asian country wants to reduce its reliance on Apple products. As reported by The Wall Street Journal, China has now banned iPhones for its government employees.
The Chinese government has asked its employees not to use Apple iPhones and other foreign-made smartphones for official purposes and not even bring such smartphones to offices. The orders have been communicated by superiors via chat groups or meetings. The orders to ban the iPhone for official purposes are seen as China’s last resort to reduce reliance on foreign technology.
Reasons for iPhone ban in China
Another reason why China is imposing a ban on foreign-made smartphones is to tighten cybersecurity in the country to prevent sensitive data from flowing outside the borders.
The latest orders could prove to be detrimental for companies like Apple, which sees China as its biggest market. Apple relies on China for as much as 19% of its revenue and iPhone is the dominating smartphone in the country.
Following the news of the iPhone ban for official purposes in China, AAPL shares have seen a sharp decline. The shares fell by 3.6% on Wednesday and were one of the worst-performing shares in the Dow Jones Industrial Average.
This is not the first time we have seen China resisting the use of foreign technology. Previously, China has asked workers in some industries to refrain from using iPhones. However, this is the first time such orders have been passed.
There are two aspects to this ban – economic and national security. China wants to safeguard its data and does not want anyone to get backdoor access to sensitive government data. On the economic front, China is suffering through a slumping phase. Therefore, it would make more sense to promote homegrown brands.
“Beijing has been urging its agencies and state-owned enterprises to replace foreign technology including computers, operating systems and software with homegrown products they deem safe and controllable,” writes WSJ.
Meanwhile, this ban can be compared to America’s ban on Huawei and the recent instructions to not use TikTok for government employees.
While Apple has not responded to Chinese orders yet, we might see the company have a word with the authorities in the country. Apple is already known to comply with Chinese local laws by storing the iCloud data of Chinese users on servers that are located within the borders of China.