Huawei exits Australia sponsorship deal over 'negative business environment'

Agence France-Presse

Posted at Aug 31 2020 12:06 PM

SYDNEY, Australia - Embattled Chinese telco Huawei exited its main sponsorship deal with rugby league's Canberra Raiders Monday, citing a "negative business environment" after Australia blocked the company from its 5G wireless networks.

The Raiders were the tech giant's first large-scale sporting sponsorship worldwide and they have backed the club for almost a decade, with their logo and name on the front of the playing kit.

But Huawei said in a statement that the "continued negative business environment is having a larger than originally forecasted impact on our planned revenue stream", in explaining its decision to terminate the deal a year early.

"It is so disappointing that it has ended this way but are very proud of the small role we have played in this great NRL (National Rugby League) club," Huawei Australia's corporate affairs chief Jeremy Mitchell said.

"Our near decade as major sponsor of the Raiders has been one of the most successful in Australian sport and we are very sad that it has come to an end."

Relations between China and Australia have nosedived since the Australian government barred Huawei from its 5G wireless networks in 2018 due to perceived links to the Beijing government, which it denies.

They took another hit when Australian Prime Minister Scott Morrison this year joined US calls for an independent inquiry into the coronavirus pandemic, which was first detected in the Chinese city of Wuhan.

Huawei will remain involved with the club, with the company logo relocated to the back of the Raiders jersey.

It will also retain naming rights of the Huawei Raiders Training Center in Canberra as "an important showcase of our technology".

Mitchell said that after the company was barred from involvement in Australia's 5G development, "we managed to find the resources to continue the sponsorship, but we just can't financially support it any longer".

Raiders chief Don Furner paid tribute to the company's "unwavering" support over the years.

"This relationship has been about so much more than just a logo on a jersey," he said.

"We have worked with Huawei on a number of very important community initiatives and fundraising opportunities for very worthwhile causes."

Huawei has become a pivotal issue in the geopolitical standoff between Beijing and Washington, which claims the firm poses a significant cybersecurity threat. 

Washington has essentially barred it from the US market and waged a global campaign to isolate the company, which overtook Samsung to become the largest global smartphone manufacturer in the past quarter.