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    U.S. Bans All Cotton and Tomatoes From Xinjiang Region of China

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    AdvertisementContinue reading the main storySupported byContinue reading the main storyU.S. Bans All Cotton and Tomatoes From Xinjiang Region of ChinaThe sweeping ban, which was based on concerns about forced labor in the region, could compel companies to reorganize their multinational supply chains.Cotton fields in the Xinjiang region of China. A new ban on imports of cotton from the area could have sweeping implications for apparel makers.Credit…Agence France-Presse — Getty ImagesJan. 13, 2021Updated 6:32 p.m. ETWASHINGTON — The Trump administration on Wednesday announced a ban on imports of cotton and tomatoes from the Xinjiang area of China, as well as all products made with those materials, citing human rights violations and the widespread use of forced labor in the region.The measure could have sweeping implications for makers of apparel and food products, many of whom have sought to distance themselves from atrocities in Xinjiang but have struggled to ensure their supply chains are free of all raw materials from the region. The area is a major source of cotton, coal, chemicals, sugar, tomatoes and polysilicon, a component in solar panels, that are then fed into factories around China and the world.The ban allows customs officials to stop imports that they suspect are made with raw materials from Xinjiang, regardless of whether they travel into the United States directly from China or through another country.China has carried out a vast crackdown on predominantly Muslim minority groups in the far west Xinjiang region, including detaining a million or more Uighurs, Kazakhs and other groups in camps and closely surveilling the rest of the population, human rights groups say.Forced labor also appears to be widespread in the region. The U.S. Customs and Border Protection said an investigation found numerous indicators of forced labor in Xinjiang, including debt bondage, restriction of movement, withheld wages, and abusive living and working conditions. The Chinese government denies the existence of forced labor in Xinjiang, saying all arrangements are voluntary.Scott Nova, the executive director of the Workers Rights Consortium, a labor rights group, called the ban “a high-decibel wake-up call to any apparel brand that continues to deny the prevalence and problem of forced-labor-produced cotton” in the region.“This ban will redefine how the apparel industry — from Amazon to Nike to Zara — sources its materials and labor,” Mr. Nova said. “Any global apparel brand that is not either out of Xinjiang already or plotting a very swift exit is courting legal and reputational disaster.”The Workers Rights Consortium estimates that American brands and retailers import more than 1.5 billion garments that use Xinjiang materials every year, representing more than $20 billion in retail sales. China is also the world’s largest tomato producer, with Xinjiang accounting for most of that production, the group says.Independent researchers and media reports have linked dozens of the world’s most prominent multinational companies to workers or products from Xinjiang, including Apple, Nike, Kraft Heinz and Campbell Soup. Campbell said it no longer sources products from the Xinjiang region.Some textile and apparel companies that used cotton or yarn from Xinjiang have announced that they are severing ties, including Patagonia, Marks and Spencer and H&M. But many firms have found it difficult to trace the origins of all the products used by their Chinese suppliers, especially given the lack of access for independent auditors to facilities in Xinjiang.The order will “send a crystal-clear message to the trade community: know your supply chains,” said Mark Morgan, the acting commissioner for U.S. Customs and Border Protection. Importers are required to ensure that their own supply chains are free from forced labor, he added. “It’s the law.”The Trump administration has added increasingly restrictive measures on Xinjiang, including placing sanctions on dozens of companies and individuals over alleged human rights violations.In December, customs officials announced a ban on cotton products made by the Xinjiang Production and Construction Corps, an economic and paramilitary group that produces much of the region’s cotton. U.S. Customs and Border Protection has already detained 43 shipments valued at more than $2 million under that ban, officials said Wednesday.Congress is also considering sweeping legislation that would block imports from Xinjiang, unless companies are able to prove that supply chains that run through the region are free of forced labor.While the United States has taken the most forceful action on this front, both Canada and Britain introduced rules this week to limit goods linked to Xinjiang from entering their countries.Despite growing concerns over Chinese practices in the region, exports from Xinjiang to the United States and Europe grew significantly from 2019 to 2020, according to the Center for Strategic and International Studies.But trade experts say the new measures will raise questions about whether customs officials are equipped to fully enforce such a wide ban, which will require tracing Xinjiang materials through supply chains around the world.A report published in October by the U.S. Government Accountability Office found that customs suffered from staff shortages and other issues despite a new division and resources devoted to blocking goods made with forced labor.In a call with reporters on Wednesday, Brenda Smith, the executive assistant commissioner at Customs and Border Protection’s Office of Trade, said it was “a challenge to be able to link what we see arriving in a port of entry back to the raw materials produced in Xinjiang.” The department is applying new tracking methods to uncover products made with forced labor, she said.The department is increasingly making use of new technologies, like pollen analysis, to try to identify cotton and other materials from Xinjiang in foreign products, officials said.AdvertisementContinue reading the main story More

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    Chinese Solar Companies Tied to Use of Forced Labor

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    AdvertisementContinue reading the main storySupported byContinue reading the main storyChinese Solar Companies Tied to Use of Forced LaborA new report shows some of the world’s biggest solar companies work with the Chinese government to absorb workers from Xinjiang, programs that are often seen as a red flag for forced labor.Solar panels in Clovis, Calif. Together, the solar companies named in the report supply most of the raw materials for solar panels on rooftops and utility energy projects in the United States, Europe and elsewhere.Credit…Chang W. Lee/The New York TimesAna Swanson and Jan. 8, 2021, 1:47 p.m. ETIn a flat, arid expanse of China’s far west Xinjiang region, a solar technology company welcomed laborers from a rural area 650 miles away, preparing to put them to work at GCL-Poly, the world’s second-largest maker of polysilicon.The workers, members of the region’s Uighur minority, attended a class in etiquette as they prepared for their new lives in the solar industry, which prides itself as a model of clean, responsible growth. GCL-Poly promoted the housing and training it offered its new recruits in photographs and statements to the local news media.But researchers and human rights experts say those positive images may conceal a more troubling reality — the persecution of one of China’s most vulnerable ethnic groups. According to a report by the consultancy Horizon Advisory, Xinjiang’s rising solar energy technology sector is connected to a broad program of assigned labor in China, including methods that fit well-documented patterns of forced labor.Major solar companies including GCL-Poly, East Hope Group, Daqo New Energy, Xinte Energy and Jinko Solar are named in the report as bearing signs of using some forced labor, according to Horizon Advisory, which specializes in Chinese-language research. Though many details remain unclear, those signs include accepting workers transferred with the help of the Chinese government from certain parts of Xinjiang, and having laborers undergo “military-style” training that may be aimed at instilling loyalty to China and the Communist Party.The Chinese government disputes the presence of any forced labor in its supply chains, arguing that employment is voluntary. The companies named in the report either did not respond to requests for comment or denied any role in forced labor.In a statement, a representative for the Chinese Embassy in Washington called forced labor in Xinjiang “a rumor created by a few anti-China media and organizations,” adding that all workers in Xinjiang enter into contracts in accordance with Chinese labor law. “There is no such thing as ‘forced labor,’” the representative said.The report adds to a growing list of companies that have been accused of relying on coerced labor from Uighurs and other ethnic minorities in China, either in their own factories or those of their suppliers.The United States and other governments have become increasingly vocal about forced labor in Xinjiang, including naming and shaming major corporations that operate in the region. The Trump administration has imposed sanctions on dozens of companies and individuals for their role in Xinjiang, including banning some exports from the region, which is also a major producer of cotton. On Dec. 2, it banned imports made with cotton produced by the Xinjiang Production and Construction Corps, a paramilitary group that American officials say uses forced labor.Congress is also considering sweeping legislation that would ban all products with materials from Xinjiang unless companies certify that the goods are made without forced labor.John Ullyot, the spokesman for the National Security Council, said that China’s campaign of repression in Xinjiang involved “state-sponsored forced labor” and that the United States would “not be complicit in modern day slavery.”“The administration has taken unprecedented actions to prevent China from profiting off of its horrific human rights abuses,” he said.Together, the solar companies named in the report supply more than a third of the world’s polysilicon, which is refined from rock and turned into the solar panels that end up on rooftops and utility energy projects, including those in the United States and Europe.Government announcements and news reports indicate that solar companies often take in assigned workers in batches of dozens or fewer, suggesting that the transfers are a small part of their overall work force. Still, the assertions from Horizon Advisory imply that much of the global solar supply chain may be tainted by an association with forced labor. Such charges could hurt its progressive image and risk product bans from Washington.GCL-Poly, Daqo New Energy, Xinte Energy and East Hope Group did not respond to multiple requests for comment.Ian McCaleb, a spokesman for Jinko Solar, said the company “strongly condemns the use of forced labor, and does not engage in it in its hiring practices or workplace operations.” He said that it had reviewed the claims in the Horizon report and “found that they do not demonstrate forced labor in our facilities.”Business & EconomyLatest UpdatesUpdated Jan. 7, 2021, 12:58 p.m. ETElon Musk has become the world’s richest person, as Tesla’s stock rallies.Simon & Schuster drops Senator Hawley’s book.Daimler responds: ‘We depend on a reliable and stable political framework.’China carries out a vast program of detention and surveillance of Uighurs, Kazakhs and other minorities in Xinjiang. Up to a million or more minorities may have been detained in indoctrination camps and other sites where they are forced to renounce religious bonds, and risk torture, assault and psychological trauma, Uighurs abroad and human rights groups say.The Xinjiang government has promoted the labor transfer programs in parallel with the re-education camps, efforts that have ramped up drastically under the current leader, Xi Jinping. The government has uprooted many from farms to work in factories and cities, in the belief that steady, supervised work can pull minorities out of poverty and break down cultural barriers. Workers may have little choice but to obey local officials who oversee their move to distant towns and industrial zones to fulfill government-set quotas.An internment camp in Xinjiang that local officials have portrayed as a vocational training center.Credit…Thomas Peter/ReutersThe growing scrutiny of the region has already prompted changes among some companies whose supply chains are entangled in these programs. Many textile and apparel companies that use cotton or yarn from Xinjiang have severed ties, including Patagonia, Marks and Spencer and H&M.The solar sector could face similar pressure. The industry has deep ties to Xinjiang, which accounts for about 40 percent of global polysilicon production, said Jenny Chase, the head of solar analysis at BloombergNEF. Xinjiang’s polysilicon production increased rapidly over the past decade, mostly because of cheap electricity from local coal plants and other government support, Ms. Chase said.That expansion has helped Chinese companies dominate foreign competitors, including in the United States. China produced 82 percent of global polysilicon in 2020, up from 26 percent in 2010, according to data from IHS Markit, while the U.S. share of production shrunk to 5 percent from 35 percent.“I am concerned that forced labor may have been used in Xinjiang,” said Francine Sullivan, the vice president for business development at REC Silicon, a Norwegian polysilicon manufacturer with operations in the United States. The company shut a facility in Washington State, despite surging overall U.S. demand.Xinjiang is known for low safety and environmental standards, Ms. Sullivan said, and forced labor “may be just part of the incentive package.”Xiaojing Sun, a senior research analyst at Wood Mackenzie, said solar companies were starting to investigate their exposure to Xinjiang and reconfigure their supply chains to avoid the region if possible.In a note to investors in October, analysts at Roth Capital Partners said the solar sector faced a “heightened risk of disruption” because of its ties to Xinjiang.“Investors are getting nervous,” Ms. Sun said.The Solar Energy Industries Association, the largest industry association in the United States, has called human rights abuses in Xinjiang “reprehensible” and strongly encouraged companies “to immediately move their supply chains out of the region.”Since unfettered on-the-ground access to Xinjiang for foreign journalists and researchers is virtually impossible, the Horizon Advisory researchers do not provide direct testimony of forced labor. Instead, they present signs of possible coercion from Chinese-language documents and news reports, such as programs that may use high-pressure recruitment techniques, indoctrinate workers with patriotic or military education, or restrict their movement.The report documents GCL-Poly accepting “surplus labor” from a rural region of Xinjiang last year. In 2018, according to an article on China Energy Net, a local news site, one of GCL-Poly’s subsidiaries also accepted more than 60 such workers.A local subsidiary of Jinko Solar, Xinjiang Jinko Energy Co., received state subsidies for employing local Xinjiang labor, including at least 40 “poor workers from southern Xinjiang” in May, according to a local government announcement from July 2020 cited by Horizon Advisory.On its public WeChat account, East Hope Group said that it had “responded to the national Western Development Call and actively participated in the development and construction of Xinjiang,” including constructing a polysilicon project in Changji prefecture in 2016, the Horizon report said.That same year, according to a Chinese news report cited by Horizon, Xinjiang’s Yarkand County signed a “labor export cooperation framework agreement” with a subsidiary named East Hope Group Xinjiang Aluminum Company.Another subsidiary of East Hope, Xinjiang East Hope Nonferrous Metals Co., “accepted 235 ethnic minority employees from southern Xinjiang,” who were given training to make up for “low educational qualifications, weak national language skills and insufficient job skills,” according to a report on the company’s website.According to Horizon Advisory, several solar companies also have ties to the Xinjiang Production and Construction Corps, which has been penalized by the Trump administration. In its 2018 financial report, Daqo New Energy said its Xinjiang facilities benefited from a lower cost of electricity because the regional grid is operated by a division of the Xinjiang Production and Construction Corps.Amy Lehr, the director of the Human Rights Initiative at the Center for Strategic and International Studies, said that work programs that draw on Xinjiang minorities and offer companies subsidies for employing them are a “red flag” for forced labor.These programs may restrict workers from quitting, traveling or participating in religious services, pay less than minimum wage, and involve harsh or unsafe work conditions, as well as the threat of detention, according to Ms. Lehr’s research.“The concern is that there is a potential for coercion, because of the level of surveillance and fearfulness,” Ms. Lehr said. Companies that source products from the region have “no way of knowing that you’re not being connected to forced labor,” she said.Nathan Picarsic, a founder of Horizon Advisory, said what the firm had documented was likely “just the tip of the iceberg.” If Americans are buying solar panels made with materials from these Chinese companies, he said, “I would say you are complicit in perpetuating this Chinese industrial policy that suppresses and disenfranchises human beings.”AdvertisementContinue reading the main story More

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    Nike and Coca-Cola Lobby Against Xinjiang Forced Labor Bill

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    WASHINGTON — Nike and Coca-Cola are among the major companies and business groups lobbying Congress to weaken a bill that would ban imported goods made with forced labor in China’s Xinjiang region, according to congressional staff members and other people familiar with the matter, as well as lobbying records that show vast spending on the legislation.The bill, which would prohibit broad categories of certain goods made by persecuted Muslim minorities in an effort to crack down on human rights abuses, has gained bipartisan support, passing the House in September by a margin of 406 to 3. Congressional aides say it has the backing to pass the Senate, and could be signed into law by either the Trump administration or the incoming Biden administration.But the legislation, called the Uyghur Forced Labor Prevention Act, has become the target of multinational companies including Apple whose supply chains touch the far western Xinjiang region, as well as of business groups including the U.S. Chamber of Commerce. Lobbyists have fought to water down some of its provisions, arguing that while they strongly condemn forced labor and current atrocities in Xinjiang, the act’s ambitious requirements could wreak havoc on supply chains that are deeply embedded in China.Xinjiang produces vast amounts of raw materials like cotton, coal, sugar, tomatoes and polysilicon, and supplies workers for China’s apparel and footwear factories. Human rights groups and news reports have linked many multinational companies to suppliers there, including tying Coca-Cola to sugar sourced from Xinjiang, and documenting Uighur workers in a factory in Qingdao that makes Nike shoes.In a report issued in March, the Congressional-Executive Commission on China, a bipartisan group of lawmakers, listed Nike and Coca-Cola as companies suspected of ties to forced labor in Xinjiang, alongside Adidas, Calvin Klein, Campbell Soup Company, Costco, H&M, Patagonia, Tommy Hilfiger and others.In a statement, Coca-Cola said that it “strictly prohibits any type of forced labor in our supply chain” and uses third-party auditors to closely monitor its suppliers. It also said that the COFCO Tunhe facility in Xinjiang, which supplies sugar to a local bottling facility and had been linked to allegations of forced labor by The Wall Street Journal and Chinese-language news media, “successfully completed an audit in 2019.”Greg Rossiter, the director of global communications at Nike, said the company “did not lobby against” the Uyghur Forced Labor Prevention Act but instead had “constructive discussions” with congressional staff aides aimed at eliminating forced labor and protecting human rights.Asked about the allegations of forced labor, Nike referred to a statement in March in which it said that it did not source products from Xinjiang and that it had confirmed that its suppliers were not using textiles or yarn from the region.Nike said that the Qingdao factory had stopped hiring new workers from Xinjiang in 2019, and that an independent audit confirmed there were no longer employees from there at the facility. (According to a report published in March by the Australian Strategic Policy Institute that cited state media, the factory employed around 800 Uighur workers at the end of 2019 and produced more than seven million pairs of shoes for Nike each year.)China’s vast campaign of suppressing and forcibly assimilating Uighurs and other minorities in Xinjiang has attracted the scorn of politicians and consumers around the world.But for many companies, fully investigating and eliminating any potential ties to forced labor there has been difficult, given the opacity of Chinese supply chains and the limited access of auditors to a region where the Chinese government tightly restricts people’s movements.The Uyghur Forced Labor Prevention Act would require companies sending goods to the United States to scrutinize those supply chains, or perhaps abandon Chinese suppliers altogether. It would impose high standards, barring imports of goods made “in whole or in part” in Xinjiang unless companies prove to customs officials that their products were not made with forced labor.The bill also targets so-called poverty alleviation and pairing programs that ship Muslims from impoverished areas to work in factories elsewhere, which human rights groups say are often coercive. Companies would be required to disclose information on their ties to Xinjiang to the Securities and Exchange Commission.Richard A. Mojica, a lawyer at Miller & Chevalier, said that for many companies, convincing the authorities that they have no involvement with forced labor could take months. Firms were already responding by trying to find sources for products outside Xinjiang, he said.“Rebutting a presumption of forced labor is going to be a very challenging endeavor,” he said.Companies and groups lobbying on the bill have been pushing for various revisions, including easing disclosure requirements, people familiar with the conversations said.Apple, which has extensive business ties to China, has also lobbied to limit some provisions of the bill, said two congressional staff members and another person familiar with the matter.Disclosure forms show that Apple paid Fierce Government Relations, a firm led by former staff aides to Senator Mitch McConnell of Kentucky and President George W. Bush, $90,000 to lobby on issues including Xinjiang-related legislation in the third quarter. Apple’s lobbying was previously reported by The Washington Post.Apple also paid outside firms this year to lobby on another bill, the Uyghur Forced Labor Disclosure Act of 2020.Apple disputed the claim that it had tried to weaken the legislation, saying it supported efforts to strengthen American regulations and believes the Uyghur Forced Labor Prevention Act should become law.According to a document viewed by The New York Times, Apple’s suggested edits to the bill included extending some deadlines for compliance, releasing certain information about supply chains to congressional committees rather than to the public, and requiring Chinese entities to be “designated by the United States government” as helping to surveil or detain Muslim minority groups in Xinjiang.In its March report, the Australian Strategic Policy Institute identified Apple and Nike among 82 companies that potentially benefited, directly or indirectly, from abusive labor transfer programs tied to Xinjiang.That report said that O-Film Technology, a contractor for Apple, Microsoft, Google and other companies, received at least 700 Uighur workers in a program that was expected to “gradually alter their ideology.” It tied other Apple suppliers, including Foxconn Technology, to similar employment programs.Apple said in a statement that it had the strongest supplier code of conduct in its industry and that it regularly assessed suppliers, including with surprise audits.“Looking for the presence of forced labor is part of every supplier assessment we conduct and any violations of our policies carry immediate consequences, including business termination,” the statement said. “Earlier this year, we conducted a detailed investigation with our suppliers in China and found no evidence of forced labor on Apple production lines and we are continuing to monitor this closely.”Lobbying disclosures show that companies have spent heavily to sway Congress on Xinjiang-related legislation, though they reveal nothing about their specific requests.In the first three quarters of 2020, Nike spent $920,000 on in-house lobbying of Congress and other federal agencies. Disclosures do not break down expenditures by topic, but show Nike lobbied on matters including physical education grants, taxes and climate change, as well as the Uyghur Forced Labor Prevention Act.Nike also paid outside firms like Cornerstone Government Affairs, Ogilvy, Capitol Counsel, GrayRobinson, American Continental Group, DiNino Associates and Empire Consulting Group more than $400,000 this year to lobby on issues including the act.Mr. Rossiter said that Nike had these firms on retainer long before the Xinjiang legislation was introduced, and that the company actively worked with lobbying firms to engage Congress on a variety of subjects it cares about.Coca-Cola has also invested heavily, spending $4.68 million in the first three quarters of 2020 on in-house lobbying and hiring Empire Consulting Group and Sidley Austin to lobby on issues including the act.Coca-Cola said in a statement that it complies with all laws associated with its political activities and has “adopted best-in-class disclosures practices.”The U.S. Chamber of Commerce declined to comment on lobbying, instead providing a letter it sent to Congress in November with seven other industry groups. The letter said the groups had long been working to combat forced labor, and urged the government to take a comprehensive approach that would mobilize the administration, Congress and foreign governments to address the problem, in addition to industry. More