Apple Signed ‘Secret’ $275 Billion Deal with China in 2016

Photo credit: Bloomberg

According to newly discovered internal documents published on Tuesday, Apple CEO Tim Cook reportedly managed to bypass restrictions on his company’s operations in China, signing a “secret” $275 billion deal with Chinese authorities in 2016.

The massive five-year agreement signed with China’s National Development and Reform Commission, according to company insiders and Apple documents, obliged Apple to boost the Chinese economy through investments and other business enterprises.

To accomplish the deal, Cook was allegedly forced to make several trips to China in a time when Apple was exposed to a series of regulatory actions that negatively impacted its business, from the government in Beijing, which believed the company’s contribution to the local economy wasn’t enough.

The regulatory measures by the Chinese government, which Cook attempted to throughout 2016, were damaging for his company’s App Store, iCloud, and Apple Pay systems, and decreased the sales of iPhone for some time.

In line with the agreement and in exchange for the necessary support and assistance from the Chinese government, Cook pledged that Apple would work alongside Chinese academics and local manufacturers, even buying components from in-country suppliers, on top of the renewable energy initiatives and setting up a string of new retail locations and R&D centers across China.

Following the agreement’s signing, Cook declared a $1 billion investment into a Chinese Uber competitor, Didi Chuxing, in May 2016 followed by a major deal with Xinjiang Goldwind Science and Technology, China’s top wind turbine producer.

Since the regulatory crackdown in 2016, Apple’s business in China has recovered significantly, setting last summer a quarterly revenue record of $68 billion while continuing to open new storefronts and R&D centers.

According to the report, China now makes up for about one-fifth of Apple’s total sales.

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