China has put PVH on its “unreliable entities list.” But what does this really mean?
This move could bar PVH, the owner of Calvin Klein and Tommy Hilfiger, from doing business in China. The reason? PVH refuses to buy cotton from Xinjiang, where Uyghurs face a raft of human rights abuses. China may be retaliating against the company, using trade as a political weapon.
The ramifications of this decision could be huge. PVH earns 6% of its revenue from China, and with Calvin Klein present in virtually every province, restrictions would be a major blow. However, unlike Nike, PVH is small enough that China can take action without major job losses.
This case shows how global brands are caught between business and politics. Companies must decide: profits or principles?
Key vocabulary
| Vocabulary | Part of Speech | Explanation (解釋) | Sample Sentence |
|---|---|---|---|
| Bar | Verb | To officially prevent (禁止) | The government decided to bar the company from selling products in the country. |
| Raft | Noun | A large number (大量) | The new law introduced a raft of changes to improve workers’ rights. |
| Retaliate | Verb | To take revenge (報復) | The company retaliated by cutting off its investments in the region. |
| Ramification | Noun | A consequence (後果) | The trade war had serious ramifications, leading to higher costs and reduced sales. |
| Virtually | Adverb | Almost, nearly (幾乎) | The brand has a presence in virtually every major city in the country. |
Reading comprehension
1. Why did China target PVH instead of a bigger brand like Nike?
2. Do you think businesses should take a stand on human rights issues? Why or why not?