Basketball in China and the Politicization of the NBA

In 1979, the Washington Bullets – now known as the Washington Wizards – made a historic trip to compete in exhibition games in Beijing and Shanghai against the Chinese national team and the Bayi Rockets. They became the first U.S. professional sports team to visit the country shortly after the normalization of relations between China and the United States. Fast forward to 2021, and diplomatic relations are having the opposite impact: The NBA has become a conduit for simmering political tensions between the United States and China.

The first manifestation came in the form of harsh measures taken by Chinese commercial partners, fans, and sponsors in late 2019 and 2020 in response to a tweet by then-Houston Rockets General Manager Daryl Morey expressing solidarity with Hong Kong, including the slogan “Fight for Freedom. Stand With Hong Kong.” Broadcasters and streaming platforms pledged to retaliate against a team that had become beloved in the early 2000s when China’s Yao Ming was signed (more than 200 million Chinese viewers tuned into his first game against the Los Angeles Lakers). Although Morey quickly backtracked and the team and the broader NBA distanced themselves from commenting on China-Hong Kong dynamics, Chinese nationalist backlash rippled through the extensive networks that connect the NBA and China.

More recently, the NBA has again found itself in Sino-American political crosshairs, but the source of targeted pressure this time is coming from U.S. lawmakers. Chairs of the bipartisan Congressional-Executive Commission on China sent a letter to the leadership of the National Basketball Players Association (the union representing players) urging NBA athletes to sever their endorsement deals with a handful of China-based firms over their ongoing commercial links to Xinjiang cotton. The chairs wrote, “We believe that commercial relationships with companies that source cotton in Xinjiang create reputational risks for NBA players and the NBA itself,” invoking the U.S. State Department’s determination that the central government in China is committing genocide and crimes against humanity in Xinjiang, via policies of mass internment and the systematic use of forced labor in manufacturing goods for global export. “The NBA and NBA players should not even implicitly be endorsing such horrific human rights abuses,” they added.

The NBA itself has taken some action amid international condemnation of China’s treatment of minorities. It terminated its ties with a training facility in Xinjiang and its deputy commissioner, Mark Tatum, said the NBA was in the process of reevaluating its academy programs in China. This statement came on the heels of an ESPN investigation into complaints from American coaches about physical abuse and a failure to provide education by Chinese partners on the ground.

Although this dynamic is not particularly unique to the NBA, it illustrates the push and pull global organizations and enterprises face when core markets of a business are at the nexus of an increasingly polarized diplomatic moment. Still, these twin pressures from Beijing and Washington do push us to better grasp the depth of the NBA’s ties to China.

The sport of basketball was already beloved in China, given Mao Zedong’s support for the game, when the U.S. basketball league first granted broadcasting rights to China Central Television in 1987. Over the past three decades, China has grown into one of the league’s most important markets, with a fan base of hundreds of millions and NBA China, which manages the league’s operations in the country, has grown to be worth an estimated $4 billion. The NBA also launched its first store in China in 2008, with more than a thousand people showing up for the opening, and in 2020, the organization opened its largest flagship store in the world in Guangzhou. As the league’s popularity ballooned in China in the mid 2000s, the NBA expanded its series of preseason games held abroad, with Beijing and Shanghai as feature destinations, and developed summer tours for players. Only a handful of Chinese nationals have played in the NBA, and none have matched Yao Ming’s star status. Meanwhile, notable former NBA stars and veterans have found success in China’s professional basketball league, even with the limited number of foreign players allowed on each Chinese Basketball Association (CBA) team.

As much as the NBA and Western sports firms have invested in expanding their presence in the Chinese basketball market, China-based companies have reciprocated the opportunity to forge investments in the NBA.

One of these investment paths has been through share holdings of the NBA China organization; another is through corporate sponsorship of teams; and third, China-based firms are negotiating major endorsement deals, much like those struck by U.S. counterparts, such as Nike, Adidas, and Under Armour. China’s sports powerhouses, Li-Ning, Anta, and Peak have signed lucrative deals with major stars in the American league and these relationships have been the target of U.S. Congressional pressure, as shown by the letter pushing for players to leverage their contracts to force the hands of sponsors over their ties to Xinjiang cotton. In recent years, these Chinese sport brands have increased their presence in the NBA endorsement game, winning deals with more and increasingly influential stars.

Shaquille O’Neal became the highest profile American sports star to sign with a Chinese sports brand back in 2006 with a four-year deal estimated to be worth $1.25 million. Since then, Li-Ning has inked major endorsement deals with three-time NBA champion Dwyane Wade, CJ McCollum, and Evan Turner. Clinching a “lifetime” deal with Wade will continue to open doors for Li-Ning for more endorsements, particularly as other players like Jimmy Butler and D’Angelo Russell sign up for sneaker deals under his Way of Wade brand in collaboration with the Chinese giant. The current iteration of Way of Wade sneakers retail for upward of $200.

Li-Ning is not alone in the endorsement game. Anta Group, the world’s third largest sportswear company, inked a shoe deal with former NBA forward Kevin Garnett in 2010 and landed Golden State Warrior star Klay Thompson in 2014 when he left Nike. Thompson agreed to a 10-year extension in 2016 worth an estimated $80 million. Other members on Anta’s roster include veterans Rajon Rondo and Gordon Hayward, as well as up and coming players such as Hamidou Diallo and James Wiseman.

These Chinese companies not only back sneaker deals and endorsements with individual NBA players but are also part of the marketing operations in local markets across China. Political pressure from either side to suspend ties could result in incredible financial losses. While players and the NBA organization as a whole have been leaders on the domestic front about justice and police accountability, this ethos does not appear to be diffusing across international borders, or at least not where the future growth of the NBA likely lies. This dissonance only leaves the NBA’s operations in China more vulnerable to become political fodder for Beijing or Washington.

While sport provided an opening for a thaw in China-U.S. relations 50 years ago under the auspices of ping pong diplomacy, these recent dust ups for the NBA in bilateral ties highlight the potential for governments to leverage sport – often viewed as a global cultural force that can unify – for political, strategic purposes.