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Apple CEO Treads Softly During Rare Speech in China

Tim Cook stopped short of criticizing authorities for demanding access to customer data, demonstrating the sensitivity CEOs are showing in the still-promising growth market.

Apple CEO Tim Cook and IBM Pres./CEO/Chair Ginni Rometty speaking at China Development Conf.

Apple CEO Tim Cook has delivered a rare public address in China, during which he touted the benefits of free trade but took care not to rock the boat with his Eastern hosts on issues like cybersecurity.

It’s unusual for Western leaders to make speeches in the world’s second-biggest economy, which is attempting to compete internationally by nurturing its own homegrown corporate and technology champions.

That’s putting CEOs seeking to expand in China in a testy position. Apple, for instance, last week announced it was building two new R&D facilities there as it struggles to compete with the likes of Huawei and Xiaomi in the local smartphone market.

“WE THINK AN INDIVIDUAL SHOULD OWN THEIR DATA AND SHOULD BE ABLE TO CONTROL THEIR DATA.”

In what was reportedly an hour-long speech, Cook on Saturday encouraged China to open its door wider. Globalization, he said, was “great for the world”, though he acknowledged its benefits hadn’t always been fairly distributed. The comments align with the pro-trade stance outlined by Chinese President Xi Jingping during a milestone speech at Davos in January.

“I think the worst thing would be to—because it didn’t help everyone—is to say it’s bad and do less of that,” Cook said. “I think the reality is you can see that countries in the world that isolate themselves, it’s not good for their people.”

Apple is among companies that have been singled out by Donald Trump for making products overseas. The president has encouraged the tech giant to consider manufacturing iPhones in the U.S. and at least one key component supplier, Foxconn, has indicated it may invest in new U.S. facilities. It’s unclear, however, how much activity could realistically occur outside of lower-cost production centers such as China without pushing up iPhone prices.

In his speech, Cook also touched on privacy matters, but stopped short of delivering the kind of criticism he gave to U.S. authorities for demanding access to an iPhone owned by a terrorist assailant.

“We think an individual should own their data and should be able to control their data,” Cook said, while reminding the audience that Apple encrypts data to keep out hackers.

China last year introduced rules that forced companies to store data and assist authorities in investigations, a move that frustrated many Western politicians and CEOs already concerned about suspected state-sponsored cyber attacks.

Cook was speaking at the China Development Forum in Beijing for the first time. Facebook CEO Mark Zuckerberg addressed the same event, attended by senior government representatives, last year, though there’s still little sign that a current ban on the social media site in China will be lifted any time soon.

The CEOs of Shell, Johnson & Johnson, BHP Billiton, United Technologies and Monsanto are among other leaders listed as speakers at this year’s event.

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About Ross Kelly

Ross Kelly
Ross Kelly is a London-based business journalist. He has been a staff correspondent or editor at The Wall Street Journal, Yahoo Finance and the Australian Associated Press.