The recent public address by Shein founder Chris Xu, affirming the fast-fashion giant’s Chinese roots, signals a critical shift in how multinational companies navigate an increasingly complex geopolitical landscape. Speaking at a Guangdong provincial government forum on February 24, Xu lauded the region’s industrial ecosystem for Shein’s rapid growth, highlighting the company’s support for over 600,000 jobs in the province and pledging a 10 billion yuan ($1.5 billion) investment to bolster its local supply chain. This move stands in stark contrast to Shein’s previous efforts to present itself as a Singapore-based entity, a strategy experts now observe is losing its efficacy amid heightened scrutiny from both Beijing and Western governments.
For years, Shein, founded in Nanjing in 2008 by Chinese-American businessman Chris Xu, had sought to dilute its Chinese identity. Its relocation of headquarters to Singapore in 2021 was part of a broader trend, dubbed “Singapore-washing,” where Chinese-founded firms aimed to access global capital and reassure regulators by establishing a presence outside mainland China. This approach allowed companies to market themselves with a Western-friendly narrative while maintaining deep operational ties within China. Shein Chair Donald Tang, for instance, once emphasized the company’s “American values,” despite its reliance on nearly 10,000 suppliers in China’s southern Guangdong province. However, this balancing act appears to have become unsustainable. Xin Sun, a senior lecturer at King’s College London, characterizes this as a “political miscalculation,” noting that such branding narratives alienated Beijing while failing to mitigate Western regulatory concerns.
The limitations of this “Singapore-washing” strategy are becoming increasingly apparent across various sectors. Consider Manus, an AI developer that shifted its main operating entity to Singapore in 2025, anticipating future markets outside China. While Manus successfully secured an acquisition by Meta last December, valued between $2 billion and $3 billion, the deal has since faced review from Chinese regulators. These regulators argue that Manus, having been founded by Chinese engineers with a Chinese parent entity, should remain under Chinese jurisdiction, raising questions about export controls and national security. This situation underscores a growing trend where Western governments continue to view Chinese-founded companies as Chinese, regardless of their incorporation location, while Beijing demands greater loyalty from these enterprises. 
ByteDance-owned TikTok provides another high-profile example of this dilemma. Beginning around 2020, ByteDance invested billions in building out TikTok’s international headquarters in Singapore, establishing key functions like regional management and data operations there. TikTok CEO Shou Zi Chew, a Singaporean citizen, frequently highlighted his nationality and the company’s Singapore base during U.S. congressional testimonies. Yet, U.S. officials persistently regarded TikTok as controlled by its Chinese parent, leading to a legislative push forcing ByteDance to divest TikTok’s U.S. operations or face a nationwide ban. This persistent perception illustrates that merely relocating legal entities is often insufficient to alter how a company’s origins are perceived by national authorities.
The intensified scrutiny emanates from a more comprehensive regulatory lens. Le Xu, a lecturer at the National University of Singapore’s business school, points out that regulators are no longer solely focused on a company’s legal headquarters. Instead, they are examining the “entire vertical value chain—including ownership structure, supply chain, data flows, and operational control.” This holistic approach makes strategies like “Singapore-washing” less effective, as corporate backgrounds are now far more transparent. Shein’s pivot back towards openly embracing its Chinese identity, particularly after failed attempts to list in New York and London, suggests a reconciliation with Beijing, potentially paving the way for a Hong Kong IPO.
This evolving landscape forces Chinese founders to re-evaluate their global expansion strategies. Kyle Chan, a fellow at the Brookings Institution, suggests that Beijing’s demand for public support from these companies makes it “safer in the long run to continue to play up its Chinese connections, despite the risks from Washington.” Some Chinese AI founders are even choosing to establish themselves as U.S.-based companies from the outset to secure access to venture funding and advanced technology, effectively bypassing the complexities of dual identity. The era of “straddling two boats” appears to be closing, compelling Chinese-founded firms to either formally separate their domestic and international operations or seek listings in more amenable jurisdictions as they navigate an increasingly volatile geopolitical environment.
