Anta could overtake Adidas + China, Russia and Kazakhstan • China.Table

Olympia: Anta could push Adidas from the top
Kazakhstan: China and Russia want end to unrest
Beijing 2022: relaxation of Covid test requirements
BDI fears Omicron could cause recession
Guangdong helps Evergrande
Head of MV shipyards parent Genting steps down
Subsidy for fuel-efficient gasoline cars
Tools: tax benefits for small companies

Dear reader,

When the Winter Olympics in Beijing kicks off on February 4, the logo of one particular company will pop up almost everywhere: Anta. As the official Olympic outfitter, staff will be wearing Anta uniforms, the Chinese team will also be equipped by Anta – and even President Xi Jinping wore an Anta coat during his inspection tours of the Olympic venues.

The Chinese sporting goods manufacturer has achieved spectacular growth in its domestic market and is giving their Western competitors Adidas and Nike a run for their money. The company is riding a “national wave”: In part, China’s consumers consciously prefer domestic brands. Our Beijing team analyzes how Anta is benefiting from its ties to the Chinese leadership – and the downside of this success.

In our second analysis, we turn our attention to Central Asia: When violent protests broke out in Kazakhstan a few weeks ago, the cause seemed to be found quickly: The poverty-stricken population was suffering under the rise in energy prices. Yet Kazakhstan is in fact rich, thanks to natural resources, reforms and its geostrategic location. China and Russia are well aware of this. In his analysis, Frank Sieren shows how the unrest in Kazakhstan is affecting relations between Beijing and Moscow.

I hope you enjoy today’s issue!

Your
Michael Radunski

Feature

Anta is on its way to the top – ahead of Adidas

The brand Anta is almost completely unknown abroad. But the Chinese sporting goods manufacturer could soon push its Western competitors from the top in its domestic market. And cotton from Xinjiang, of all places, is playing a role. And, of course, the Winter Games in Beijing.

Chinese sporting goods company Anta Sports is having a good run. In the first half of 2021, the revenue of the company from Xiamen in eastern China shot up by 56 percent to ¥23 billion (€3 billion). Nike and Adidas, on the other hand, lost ground, which allowed Anta to further narrow the gap to the two market leaders in China. It seems to be only a matter of time before Anta will leap from third rank all the way to the top of its domestic market.

Most recently, Anta has benefited from the fact that Western companies have faced increasing pressure. As members of the Better Cotton Initiative (BCI), they were criticized. In 2020, a BCI study had identified an increased risk of forced labor on cotton farms in the western Chinese region of Xinjiang. After the allegations came to light, numerous companies issued statements expressing their concerns about forced labor and that they no longer sourced cotton from Xinjiang – or had never done so in the first place.

What was met with approval from Western human rights activists had the opposite effect in China. State media led the critics’ march: The tenor was, companies that want to sell us shoes and clothing but do not use our cotton have no business here. The nationalistic tones were apparently met with approval among Chinese consumers, who bought less Adidas and Nike. Instead, they turned their attention more to domestic brands such as Anta. The company speaks of a “national wave” that has helped the group to further boost its already respectable growth over the past few years.

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