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US-China relations intensify amid challenges on companies like TikTok, SHEIN

(Nghi Nguyen/Daily Bruin)

By Alicia Park

June 2, 2024 10:25 p.m.

This post was updated June 5 at 8:02 p.m. 

Social media platform TikTok and e-commerce companies SHEIN and Temu have recently gained prevalence in the United States, particularly among college students.

However, recent pushback from the U.S. government on the use of Chinese products remains a challenge that affects both government officials and everyday consumers.

According to the Harvard Kennedy School, China’s economic growth in the past four decades has made it the largest economy in the world by purchasing power parity, a critical manufacturing hub and the home to globally valuable companies like Alibaba and Huawei. The U.S., which has been the largest economy by gross domestic product in the world for around 150 years, now directly competes with a technologically advanced and politically conflicting nation, according to the same source.

UCLA Anderson School of Management economist William Yu said China’s growth has become a clear threat economically, and thus politically, to the U.S.

“Some people say actually we are in this new Cold War situation,” Yu said. “The first Cold War, our main rival is (the) Soviet Union. Right now, it (is) … China.”

For everyday consumers like UCLA students, this tension is most visible through actions such as the recently proposed TikTok ban.

On April 24, President Joe Biden officially signed legislation requiring TikTok’s parent company to sell TikTok to a U.S. owner within a year or risk the platform being banned in the U.S., according to NPR. Senators have stated concern regarding TikTok’s ability to gather intimate user data and utilize it to sway public opinion, create blackmail, perform espionage or access sensitive national security information, according to NPR.

The bill was passed within two months of its introduction into the House of Representatives but was met with resistance from TikTok, which filed a lawsuit May 9 on the grounds of the First Amendment, according to Reuters.

Prior to its passing, the proposed ban received vocal support from some government officials and business executives, such as Commissioner of U.S.-China Economic and Security and Review Commission Jacob Helberg and venture capitalist Vinod Khosla.

The ban also drew critics, such as everyday users and influencers, according to the Associated Press. Jasmine Nguyen, a third-year philosophy student and micro-influencer with more than 90,000 followers on TikTok, said the ban threatens many careers and businesses that rely on the social media platform.

“I thought it was a bad idea for the ban to even be in discussion because so many people depend on TikTok as a source of income or a secondary way to market their brand,” Nguyen said. “So many microbrands would suffer as a result.”

Nguyen added that in her experience, brands she has worked with preferred or requested she post content on her TikTok page – even though she has a significant following on other platforms – because brands believe the TikTok algorithm is more conducive to viral content.

Yu said while the smartly engineered TikTok algorithm allows for more virality, the company’s widespread usage in the U.S. poses a national security threat. Especially in the context of his Cold War analogy, Yu said China has an advantage over the U.S. with its technological foothold.

“Not a single … big tech company, U.S. company like Google, Facebook, Amazon has a footprint at all in China,” Yu said.

As of March 2023, TikTok had 150 million active users in the U.S., but its presence is limited within the government. The U.S. government has banned the platform from all U.S. government electronic devices and issued allegations of espionage against the company, according to NBC News.

The issue of trust between the U.S. government and Chinese companies doesn’t pertain to TikTok alone. In the past year, the U.S. government has raised concerns about data risks with Chinese e-commerce companies like SHEIN and Temu, according to the U.S.-China Security Review Commission.

SHEIN and Temu have recently garnered millions of active users in the U.S. Temu’s repeated advertisements during the 2024 Super Bowl, as well as SHEIN being the world’s most-Googled fashion brand, point to the strong global presence of both brands, according to Barrons and The Guardian, respectively.

SHEIN, a Chinese-based e-commerce retailer, sells products from clothing to technology to home appliances. According to BBC, the website’s 600,000 available products at any given time average around $10 each and are marketed through various channels like brand ambassadorship.

Lorenzo Wong, a fourth-year communication student, has worked as a brand ambassador, creating content for multiple brands like SHEIN to better position himself for a successful marketing career.

“During my time (as a SHEIN ambassador), they really emphasized the affordability and accessibility,” Wong said. “They want more people to be able to express themselves, … and I think (clothing is) a great way to express yourself.”

Both SHEIN and Temu’s business models became attractive clothing options for college students, who Wong said prefer budget-friendly options.

“It’s easily accessible and more people can get the products that they want,” Wong said. “It’s a lower barrier to entry.”

Nguyen added that she leans toward cheaper options and agreed that affordability is a top criterion on which college students base their purchasing decisions.

SHEIN and Temu’s aggressive business tactics, such as developing interactive customer experiences, utilizing social media marketing, avoiding import taxes to keep products cheap and maintaining a diversity of products that are sold, have allowed the brands to gain a significant foothold in the U.S. and globally, according to The Guardian.

However, the USCC also points to ethical violations associated with these companies. Forced and exploitative labor practices and detrimental effects on the environment are major points that the USCC raised to Congress in its April 2023 report on the risks posed by Chinese e-commerce platforms.

Furthermore, with the TikTok shop feature being a major catalyst for product overconsumption, the increased market penetration of companies such as Temu and SHEIN is inevitable, according to NPR.

Aside from the implications of China’s unregulated labor and manufacturing processes, Yu said the rise of China’s economic influence remains a political concern.

“Before (2018), (American) policymakers believed if we engaged with China, … China would become a freer, more democratic country, which would be a good thing for the whole world,” Yu said. “As it now happens, China goes in the opposite direction, becoming more authoritarian.”

Yu said looking into the future, U.S.-China relations will remain or escalate into an intense rivalry, a phenomenon he teaches and researches at the Anderson School of Management.

Bruins whose lives are closely connected to social media and consumption said they have enjoyed the benefits of these applications and services but see the importance of shifting their attitudes to address interconnected issues such as the ethical implications of overconsumption. Nguyen said she hopes Bruins will be more aware of how individual decisions can contribute to ethical and political consequences, which companies may hide or blur.

“Just because you see someone advertising for a certain good online it doesn’t mean you should be inclined to buy it,” Nguyen said. “I’ve been on that side where I see a formal marketing plan, … so take everything with a grain of salt before you hit buy.”

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Alicia Park
Park is the 2024-2025 Quad editor and was previously Quad staff. She is a rising third-year history student from New Jersey.
Park is the 2024-2025 Quad editor and was previously Quad staff. She is a rising third-year history student from New Jersey.
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