Shaq Sponsor Li-Ning Blocked by US Customs

Updated: Mar 21

As though the supply chain delays of the past several months were not bad enough, the US Customs and Border Patrol (CBP) announced a move to "detain merchandise from Li-Ning Sporting Goods" at port on March 15, 2022.

Li-Ning, a Chinese athletic apparel company in business since 1989, has managed a foothold in the US market including notable sponsorship deals with NBA players such as Shaquille O'Neal, Dwayne Wade and CJ McCollum.

The Allegation

The reason for CBP's action? "This enforcement action is the result of a CBP investigation indicating Li-Ning Sporting Goods uses North Korean labor in its supply chain."

That China would use North Korean labor in its industry should be no surprise: this practice has been well-documented for years. A fascinating look in to the lives of North Koreans working in China was the subject of this mini-docuseries published by Vice Media in 2011. At that time, Vice referred to the working arrangement as "North Korean Labor Camps"--indeed that is the title of the documentary. Whether North Korean labor ought to be considered slave labor is another point of discussion. CBP cited North Korea’s status as a foreign adversary as the rational for the sanctions on Li-Ning.

China did not take these sanctions lying down.

  1. This should be a major story, but have you heard anything about it before now? It could be speculated that China could use its considerable leverage on Western institutions to suppress the story until the problem can be resolved.

  2. Social Media influence campaigns. China is one of many countries using Social Media to influence popular sentiment in rival nations. A typical approach is to comment on an issue masquerading as a "typical citizen" and using an appeal thought to matter to the target population. An example of this approach: laughably transparent in motivation and clunky in execution.

Why Li-Ning?

Li-Ning is an important piece of China's global strategy: as one of China's premier brand offerings on the world market, Li-Ning represents China's ambition to access the global economy higher up the value chain. Li-Ning's success charts a path for Chinese industry to grow out of its 3rd-world status as a mere raw material and unskilled labor supplier to rival countries.

Photo credit: H. Darr Beiser, USA TODAY

As Li-Ning imitates Western sportswear brands in scope, design and marketing methods, China hopes to achieve the massive cultural influence brands such as Nike and Adidas bring to bear on the societies everywhere.

Why Now?

It is hard to imagine that the US CBP only recently discovered that Li-Ning has used some North Korean labor somewhere in its supply chain. The timing of this intervention is unlikely to be coincidental to some recent discovery.

China secures ever greater leverage as the violence escalates. The West can end any hope of Russian victory in Ukraine by bringing China to heel. China has so far acted coy about where their real support will go, and how far they will go once revealing it.

What will the West give up to persuade China to solve its Russia problem? How about nothing?

The sanctions by the US CBP on Li-Ning suggest the US seeks a bargaining chip to leverage China.

Presumably, China taking action that lead to a satisfactory end in Ukraine would help expedite a resolution to this labor issue. The US gains nothing by allowing Li-Ning products in to its market, where China likely still sees it as part of their long term aspirations.