Supply Chains Poisoned by Forced Labor in China, Panel Says

WASHINGTON – Human rights activists, labor leaders and others urged the Biden administration on Friday to introduce an upcoming ban on products made with forced labor in the New Territories. Cuong of China, says slavery and coercion blur corporate supply chains that run through the region and more broadly China.

The act, the Uyghur Forced Labor Prevention Act, was signed by President Biden in December and is expected to go into effect in June. It bans all goods made in Xinjiang or bound forced on certain sanctioned organizations or programs to move minority workers to employment sites, unless importers can demonstrate to the U.S. government that their supply chain is free of forced labor. painting.

It remains to be seen how strictly the law is applied and if it ends up affecting a handful of companies or more. Broad interpretation of the law could subject many products the United States imports from China, the world’s manufacturing base, where more than a quarter of the world’s production is made, under scrutiny. That could lead to more cargo being held at the US border, potentially delaying deliveries and further fueling inflation.

The law requires a task force that includes Biden administration officials to produce a number of lists of entities and products of interest in the coming months. It is not clear how many organizations the government will name, but trade experts say many businesses that depend on Chinese factories may find that at least some parts or raw materials in the supply chain Theirs can be traced from Xinjiang.

“I believe there are hundreds, perhaps thousands of companies that fit these types of laws,” said John M. Foote, an international trade partner at Kelley Drye & Warren.

The Foreign Ministry estimates that the Chinese government has detained more than a million people in Xinjiang over the past five years – Uyghurs, Kazakhs, Hui and other groups – under the guise of fighting terrorism.

China denounces these claims as “the lie of the century.” But human rights groups, former detainees, participating companies and the Chinese government provide many documents showing that some ethnic minorities are forced or coerced to work in the fields, houses. machinery and mines, to capture the population and bring about economic growth that the Chinese government sees as key to stability.

Rushan Abbas, founder and CEO of the nonprofit Campaign for Uyghurs, who Written about her sister’s detention in Xinjiang, said at a virtual hearing convened by the task force on Friday that forced labor had become a “profitable business” for the Party. Communist China, and aimed at reducing the overall population in the villages and towns of Xinjiang.

“The extent of this problem cannot be underestimated,” she said, adding that forced labor was made possible by “industry complicity.”

Gulzira Auelkhan, an ethnic Kazakh who fled Xinjiang to Texas, said during the hearing that she was detained for 11 months in Xinjiang along with Kazakhs and Uyghurs, who were subjected to torture and forced radicalization. produce. She also spent two and a half months working in a factory that made school uniforms and children’s gloves, which her supervisors say is for the US, Europe and Kazakhstan, she said. through an interpreter.

Importing goods made with slave labor was illegal. But for products related to Xinjiang, the law will shift the burden of proof to companies, requiring them to provide proof that their supply chains are free of forced labor before they are allowed to ship the goods. into this country.

Supply chain for solar products, document and tomatoes have received much scrutiny, and companies in these areas have been working for months to eliminate any exposure to forced labor. By some estimates, Xinjiang is the source of one over five cotton in the world and 45 percent its polysilicon, a key material for solar panels.

But Xinjiang is also a major supplier of other products and raw materials, including coal, oil, gold and electronics, and other companies could face reckoning when the law goes into effect. .

During Friday’s hearing, researchers and human rights activists made allegations of links to forced labor programs against manufacturers of gloves, aluminum, and car batteries. , sauces and other Chinese goods.

Horizon Advisory, a Washington-based consulting firm, stated in a recent report based on open source documents showing that China’s aluminum industry has many “forced labor indicators”, such as its relationship with labor transfer programs and the Xinjiang Construction and Manufacturing Corps, already US government sanctions target for its role in abuses in Xinjiang.

Xinjiang accounts for about 9% of global aluminum production, which is used to make electronics, cars, aircraft and packaging in other parts of China.

“China is an industrial center of the world,” said Emily de La Bruyère, co-founder of Horizon Advisory.

“Forced labor in Xinjiang and elsewhere in China is not only a serious human rights violation, but also affects international supply chains,” she said. “And this is true in sectors ranging from solar energy to textiles and aluminum.”

Law has been the subject of fierce lobbying by corporations and What about the othersincluding critics who worry that a broad interpretation of the regulation could put the United States’ resilience to climate change at risk, or further disrupt supply chains and fuel inflation.

Congress has devoted considerable funds to law enforcement. According to Foote, they have set aside $27.5 million this year to implement the law, funding probably enough to spend more than 100 full-time employees enforcing the ban on products in Xinjiang.

Companies and commercial groups say they are willing to abide by the restrictions but want to avoid undue harm to their businesses.

Vanessa Sciarra, vice president of the Clean Electric Association of America, which represents wind and solar companies, called on the government to issue detailed guidelines for importers on how to audit their supply chains. and only use carefully verified information to make decisions.

“The detention of goods for weeks or months is a serious commercial problem,” she said during the hearing.

Many companies have been conducting due diligence on their ties to Xinjiang, and several major industry associations say they have removed forced labor from their supply chains.

However, some activists expressed skepticism, arguing that the lack of access to the region made it difficult for companies to conduct independent audits. It is also unclear exactly what kind of oversight the government will require, or what kind of business constraints will be allowed by law.

For example, some companies have subdivided their supply chains, to ensure that raw materials from Xinjiang are used to make goods for China or other parts of the world, and not for the United States. States – a practice that Richard Mojica, a commercial attorney at Miller & Chevalier Chartered, deemed sufficient under the text of the law, but will be “reviewed further in the coming months and years.”

Mojica said in an interview that many companies are expecting the government to give clear and practical guidance in the coming months on how to comply with the law, but “that expectation could be misguided”.

“I don’t think we’ll get to the level of clarity that some companies expect,” he said.

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