Diageo has been forced to withdraw a London Underground poster ad for Smirnoff vodka after Taiwanese businesspeople and politicians called for a boycott of the drinks group's products.

The ad showed an unwrapped gift, with a caption that read: "Warning. This gift will break down on Christmas morning. Replacement parts are available from service centre Box No 260 Taiwan. Allow 365 working days for delivery."

The Taiwanese immediately said the ad was an insult and hurt the image of Taiwanese products. At the Taiwan Embassy in London a spokesman, Weili Yang, said: "During the past two decades Taiwan has moved from labour-intensive to technology-intensive products. We do not produce cheap umbrellas and clothes anymore - we manufacture 85% of microchips in the world.

"We expressed our feeling to the company and they promised to remove the advertisements. Because Taiwan is a big market for Johnny Walker and J&B whisky, we wanted Diageo to know we are very unhappy with this kind of vicious advertisement towards Taiwan."

A Diageo spokesman admitted the campaign, devised by JWT, was "a stupid idea" and it had decided to take down all the posters but the damage had already been done.

The company is in talks with the Taiwanese government on how to restore relations. It is trying to assess how the advert could have been authorised because it breaks Diageo's own internal marketing code, which promotes cultural sensitivities.

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