According to unnamed people with knowledge of the situation, The Wall Street Journal reported that China has prohibited central government officials from using iPhones.
Following the news, Apple’s shares fell 3.6% on Wednesday, closing at $182.91 in New York. This represented the largest daily decline in a month. Apple had increased 46% so far this year before Wednesday.
According to the WSJ, managers have been informing employees of the ban through meetings or chat groups.
Apple (AAPL) and the Chinese Ministry of Foreign Affairs have both been contacted by CNN, but no response has been received.
Despite the apparent lack of a formal policy, a source who frequently interacts with Chinese central government agencies told CNN that Chinese officials had been abstaining from using iPhones even before the pandemic. Due to the sensitivity of the topic, the source requested anonymity.
According to the source, central government officials now frequently use smartphones produced by significant domestic firms, particularly Huawei.
According to a CNN report from June 2022, some Chinese government ministries had a policy of forbidding Teslas from entering their facilities due to security concerns.
Tim Cook, the CEO of Apple, paid a prominent visit to the nation in March. With about 19% of its total revenue coming from China, the country is a significant market and manufacturing hub for the business.
The United States may have taken similar actions against Chinese technology, so the iPhone ban for government officials may be retaliation. This could have a chilling effect on Apple and other major foreign companies with a significant presence in China.
US restrictions have long been in place for Chinese companies ZTE and Huawei. Additionally, because both companies pose “an unacceptable risk” to US national security, the Biden administration prohibited approvals of new telecommunications equipment from both companies in November 2022.
