Business

US issues restrictions on import of Xinjiang cotton and apparel products, citing forced labour

US customs agency issues Withhold Release Orders, banning cotton, apparel, hair products and computer parts from four Xinjiang companies
In addition to four companies, the orders target a specific ‘training centre’, which the US considers a detention camp
The US has issued new restrictions on the import of products from Xinjiang, citing the alleged use of forced labour. Photo: Shutterstock
The US has issued new restrictions on the import of products from Xinjiang, citing the alleged use of forced labour. Photo: Shutterstock

The US government has announced new restrictions on the import of products, especially cotton and apparel, from China‘s Xinjiang Uygur autonomous region, citing concerns over the alleged widespread use of forced labour there.

The announcement was made by the US Customs and Border Protection (CBP) agency on Monday, and came in the form of five separate Withhold Release Orders (WRO).

Moreover, Customs and Border Protection Commissioner Mark Morgan told reporters: “These are not the first WROs the US has issued on Chinese goods, and I can tell you I’m absolutely confident they’re not going to be the last.”

One order applies to all cotton “produced and processed” by the Xinjiang Junggar Cotton and Linen. Another applies to apparel made by the Yili Zhuowan Garment Manufacturing and the Baoding LYSZD Trade and Business, both in Xinjiang. Around 85 per cent of China’s cotton is produced in Xinjiang, according to US government data and local state media reports. The US imported US$50 billion worth of textiles from China last year.

Other products include computer parts made by the Hefei Bitland Information Technology in Anhui Province, and hair products made in Xinjiang’s Lop County Hair Product Industrial Park.

The last WRO applies to “all products” made with labour from Xinjiang’s Lop County No 4 Vocational Skills Education and Training Centre, one of numerous facilities the United Nations has identified as part of a series of detention camps holding up to one million Uygurs and other ethnic Muslims in Xinjiang.

The customs agency is part of the US Department of Homeland Security (DHS), and Kenneth Cuccinelli, its acting deputy secretary, said that “by taking this action, DHS is combating illegal and inhumane forced labour, a type of modern slavery, used to make goods that the Chinese government then tries to import into the United States”.

“When China attempts to import these goods into our supply chains, it also disadvantages American workers and businesses,” he said.

In a tweet, Cuccinelli went further, calling the Xinjiang training centres “concentration camps”.

The orders state that any products subject to the WROs are considered to have been produced with state-sponsored forced labour. They are linked to what the US government calls the Chinese government’s “systemic human rights abuses against the Uygur people and other ethnic and religious minorities”.

According to the orders, items that cannot be proven to have been made without the use of forced labour must be destroyed or re-exported from US ports.

The orders come after an intense period of lobbying in Washington from advocates for human rights, worker rights and Uygur rights, including the American Federation of Labour and Congress of Industrial Organisations, the Uygur Human Rights Project and the Human Trafficking Legal Centre.

The coalition claims that virtually the entire apparel sector is implicated in the use of forced labour in Xinjiang, including leading brands like Adidas, H&M, Lacoste, Nike, Ralph Lauren and Zara.

The WROs are the latest in a flurry of US activity and legislation in recent months that have focused sharply on China‘s human rights abuses.

US House of Representatives sends Uygur Human Rights Policy Act to Trump’s desk for approval

The US departments of Treasury and Commerce have also both issued sanctions on private companies, individuals and quasi-government agencies in Xinjiang, including the sprawling Xinjiang Production and Construction Corps (XPCC) on July 31.

Also in July, 11 companies “implicated in human rights violations and abuses in the implementation” were added to the Commerce Department‘s “entity list”, restricting them from doing business with US firms.

Among those companies was a subsidiary of the Hong Kong-based apparel giant Esquel Group – which has denied any wrongdoing, and which has already hired the law and lobby firm Akin, Gump, Strauss, Hauer & Feld to represent its interest on Capitol Hill, according to filings at the US House of Representatives.

The orders had been expected by industry sources for some time, with an announcement originally planned for last week.Some sources said the Trump administration was likely to back an even broader order targeting all cotton exports from Xinjiang.

Leading products exported from Xinjiang Uygur autonomous region. Image: Centre for Strategic and International Studies

Leading products exported from Xinjiang Uygur autonomous region. Image: Centre for Strategic and International Studies

But the issuance had been delayed by dissenting views from other US government departments, according to former White House officials and industry sources.

In particular, those departments noted the difficulty in policing the apparel and cotton orders, which could prove unwieldy due to the opaque nature of the cotton supply chain in China, and Xinjiang’s role in that chain.

One senior executive from a textiles company – speaking anonymously due to the sensitivity of the issue – said that it would be impossible for textile firms in China to rid their supply chains of Xinjiang cotton, since the supply chain is so fragmented.

You have cotton or fabric providers, but you don‘t know where all their raw materials come from. Look how fabric is sold, you have so many fabric converters and they buy from so many different mills – some are in Xinjiang, some are notSenior executive

“You have cotton or fabric providers, but you don‘t know where all their raw materials come from. Look how fabric is sold, you have so many fabric converters and they buy from so many different mills – some are in Xinjiang, some are not,” the source said.

“They typically won’t reveal which mills are being used because they don’t want competitors to go there directly. It is a very fragmented way of working.”

Even so, Amy Lehr, director and senior fellow at the Human Rights Initiative at the Washington-based think tank Centre for Strategic and International Studies, said the WROs were extremely significant.

“The CBP action on goods produced with Xinjiang forced labour is narrower in scope than the administration originally indicated,” she said.

“Nevertheless, the issuance of five withhold release orders in one day, directed at multiple sectors, is still historic, and may portend broader actions still to come.”

If you have a suspicion something might be problematic at a supplier, it is very hard to either prove that’s not true or prove that it is in a definitive way,Amy Lehr

Lehr agreed with the textiles industry executive that Xinjiang is “an area with such severe levels of surveillance and repression that you really can‘t do traditional labour audits”.

“If you have a suspicion something might be problematic at a supplier, it is very hard to either prove that’s not true or prove that it is in a definitive way,” she added.

“Western auditors certainly can’t get into the region, Han [Chinese] auditors have a hard time getting into the region and then it’s very hard to ask the questions that need to be asked. The auditors themselves might actually put themselves at risk by doing their job properly.”

Another stumbling block was said to be the phase one trade deal with China, through which the US is to sell billions of dollars of agricultural products – including cotton – to China over a two-year period. Banning Chinese-made cotton products could easily draw a reciprocal ban on American cotton in China.

Data from the US International Trade Commission showed that cotton-related US exports to China rose 62 per cent over the first seven months of the year – 206 per cent in July alone.

Source – South china morning post

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