China recently detained four employees from Taiwan, who work at the world's largest iPhone manufacturing facility, Foxconn's Zhengzhou plant, and produces about 80% of all iPhones.
The detention has attracted a lot of remarks in respect to the worsening relationship between the two countries. However, this could also leave a mark on Apple which relies on Foxconn and China.
Detained Foxconn Employees by China
Reports from The Wall Street Journal indicate that four Taiwanese employees at the Chinese Foxconn facilities, manufacturing products for Apple, have been detained by local authorities. The reasons for their detentions are unclear to date, but Taiwanese officials are getting concerned over the situation.
The Taiwanese agency revealed that the employees were accused of an offense sounding like a "breach of trust." Details remain vague and of course, this would leave businesses and investors worried over the risks of operating within China.
What's more, the Taiwan Mainland Affairs Council (MAC) called the detentions "bizarre" and feared that such moves could deal a devastating blow to investor confidence in China.
Amid the growing tensions between the two East Asian nations, Mac reported that no loss on financial grounds was seen.
An Act of Possible Political Motive
Detentions are likely to be politically motivated, considering that the relations between two countries, China and Taiwan, have been narrowing during recent years.
China has been continuously taking aggressive steps toward Taiwan by conducting military exercises designed to blockade the island. Intelligence from the militaries of the UK and US suggests Beijing will have prepared itself for an invasion of Taiwan by 2027, thus marking the 100th anniversary of the People's Liberation Army.
To counter all these threats, Taiwan's key leading companies—including the TSMC, which is the main chip supplier to Apple-have reportedly developed plans to shut down their machines remotely in case an invasion would not allow China to access all of its high technologies.
9to5Mac reports that China has introduced a provision it deems as targeting the "Taiwan independence die-hards," threatening them with grave punishment, including death. This step has been a major one that has made it relatively tense for Taiwanese individuals working or doing business in China.
Rising Concern Over the Safety of Taiwanese Nationals Working in China
The detentions of several Foxconn employees in China have raised issues of national security and business risks for foreign investors. MAC Calls for Non-Essential Travel Avoidance to China Taiwanese nationals were advised by the MAC not to travel to China for non-essential purposes due to a recent increase in national security laws that created more than a few instances of detention and interrogation.
This Could Hurt China's Relation to Apple
Since Foxconn is one of the Apple's main suppliers of tech parts, the recent detention of Taiwanese workers by China can put a strain on its relationship with China.
The detentions further press the case for diversifying the supply chain and lessening Apple's dependence on Chinese manufacturing. Well, this is not new since diversification plans already reached Vietnam and India.
