Image: TheInformation

Apple CEO Tim Cook ‘secretly’ signed $275 Billion deal with China in 2016

Image: TheInformation

According to The Information, Apple CEO Tim Cook “secretly” inked a $275 billion pact with Chinese officials, guaranteeing that Apple would assist in the development of China’s economy and technological skills.

Tim Cook personally formed a five-year agreement with the Chinese government during a series of in-person visits to the nation in 2016, according to a comprehensive paywalled report based on interviews and supposed internal Apple papers.

A number of Apple executives were reportedly concerned about bad publicity in China and the company’s poor relationship with Chinese officials, who believed that Apple was not contributing enough to the local economy, prompting them to push for a deeper collaboration with the Chinese government.

Cook allegedly “personally lobbied officials” in China over threats to Apple Pay, iCloud, and the App Store, according to alleged internal papers.

Cook set out to utilise a “memorandum of understanding” between Apple and the National Development and Reform Commission, a strong Chinese government agency, to legally commit to a series of concessions in exchange for regulatory exemptions.

Apple’s government affairs team in China drafted the 1,250-word deal, which Cook steered during his meetings with Chinese officials.

Cook stated in May 2016 that Apple would invest $1 billion in Didi Chuxing, a Chinese ride-hailing service, in an attempt to appease authorities, according to the article. Cook, Apple Chief Operating Officer Jeff Williams, and government affairs director Lisa Jackson met with senior government officials in Zhongnanhai, the Communist Party of China’s central headquarters, shortly after.

Cook’s efforts resulted in the successful signing of a multibillion-dollar agreement that exempted the company from a number of regulatory proceedings and allowed it access to the Chinese market in exchange for large investments, business partnerships, and worker training in the nation.

Apple promised to help Chinese manufacturers develop “the most advanced manufacturing technologies,” “support the training of high-quality Chinese talents,” use more components from Chinese suppliers, sign deals with Chinese software firms, collaborate with research in Chinese universities, and directly invest in Chinese tech companies, among other things, as well as support for about a dozen Chinese government causes.

According to the agreement, if neither party raises any complaints, the deal will be automatically renewed for another year until May 2022.

Apple promised to spend “many billions of dollars more” in China than it currently does, including on new retail outlets, R&D centres, and renewable energy projects. Apple’s pledge, according to other internal documents, amounted to more than $275 billion in spending over a five-year period.

According to The Information, Apple is significantly reliant on Cook for foreign discussions, and the corporation may encounter issues dealing with government relations if Cook steps away as CEO.

For more information, see The Information‘s full report.