Xinjiang: apparel groups expect Trump administration blocking order on Chinese textile imports
- Sources say a Withhold Release Order is in the works, which would block some apparel imports thought to have been made with forced labour
- Barring the use of any Xinjiang cotton in clothing shipped to the United States would be an escalation of US actions on human rights abuses in the region
This story is part of an ongoing series on US-China relations, jointly produced by the South China Morning Post and POLITICO, with reporting from Asia and the United States.
US apparel groups are expecting a Trump administration decision as early as this week blocking imports of Chinese-made textile and apparel products on the grounds that they are the products of forced labour in the Xinjiang region of China, according to textiles industry sources and a former Trump White House trade official.
Such an order, which would come from US Customs and Border Protection (CBP), has the potential to affect tens of billions of dollars of US textile and clothing imports that contain cotton, yarn or fabric produced in the Xinjiang Uygur Autonomous Region (XUAR). It also could boomerang back on US cotton producers if Beijing is provoked into retaliation.
The mandate, known as a Withhold Release Order (WRO), would not be an actual import ban. But goods subject to a WRO have to be re-exported or destroyed if CBP determines they were made with forced labour.
01:54
China hits back at UK claims of forced sterilisations and other human rights abuses against Uygurs
CBP did not respond to requests for comment.
Barring the use of any Xinjiang cotton in clothing shipped to the United States would be an escalation of US actions expressing disapproval of forced labour and other human rights abuses in the region. The US Commerce Department already has placed close to 50 Chinese operations on its Entity List for involvement in those practices, effectively banning US companies from doing business with them without a special license.
US-China relations have deteriorated dramatically in the past year over a number of issues, including Beijing’s handling of the early stages of the coronavirus outbreak in Wuhan, its crackdown on political dissent in Hong Kong and its treatment of the Uygurs, an ethnic Muslim minority.
Giant Xinjiang company may be biggest ever to face US sanctions
The US State Department, in its most recent annual report on human trafficking, has accused the Chinese government of engaging in “widespread forced labour,” partly through the arbitrary detention of more than one million Uygurs, ethnic Kazakhs, ethnic Kyrgyz, and other Muslims in the XUAR.
POLITICO reported last month that the Trump administration has been mulling whether to formally label China’s brutal repression of the Uygurs a “genocide.”
About 85 per cent of China’s cotton is grown in Xinjiang, according to the US Agriculture Department. And a coalition of union and activist groups, who have called on clothing brands and retailers to stop sourcing from the Uygur region within 12 months, estimate about one fifth of all cotton garments sold in the world contain Xinjiang cotton or yarn.
The activist groups charge that nearly the whole apparel industry – including brands such as Adidas, H&M, Lacoste, Nike, Ralph Lauren and Zara – is linked to specific cases of forced labour in the region. They back up their claim with reports from governmental agencies, news outlets, think tanks and associations.
Earlier this year, a bipartisan group of lawmakers in both the US House of Representatives and the US Senate introduced legislation that would require corporations to prove with “clear and convincing evidence” that any products sourced from the XUAR are not made with forced labour before they are allowed entry in the US.
01:57
US House passes Uygur law demanding sanctions on China over human rights abuses in Xinjiang
Although neither chamber has voted on the measure, the introduction of the legislation has put pressure on US President Donald Trump to take action.
In addition, the American Federation of Labour and Congress of Industrial Organisations (AFL-CIO) and several Uygur rights and anti-slavery groups in late-August formally asked the CBP to issue a regional WRO on cotton and cotton-containing goods from Xinjiang.
Most WROs are company-specific. But in their petition, the AFL-CIO and the other groups argued a regional WRO would have the greatest impact and require China to choose “between continuing the persecution of the Uygur people or face the exodus of billions of dollars in business contracts and investments from US companies and others.”
China’s export machine keeps humming, despite talk of decoupling
John Foote, a trade lawyer at Baker McKenzie who has been tracking the issue, said it’s still not clear how aggressive any CBP action would be.
“The short answer is this WRO threatens to have a massive impact, but a lot will be determined by how CBP chooses to administer it,” Foote said.
Policing tens of billions of dollars in imports would be a massive undertaking for the CBP, and would entail tracing the supply chain of goods that arrive in the US.
Tom Cliff, a professor in Chinese Studies at the Australian National University and author of a 2018 book on Xinjiang, compared the chances of tracing cotton from Xinjiang through the Chinese and Asian supply chains to “throwing a bucket of water into the river – how do you ever hope to find it again?”
China has ample ammunition to retaliate against a potential ban because it is a large importer of American cotton.
Trade data from the US International Trade Commission shows that cotton-related exports to China rose 62 per cent over the first seven months of the year compared to a year earlier, and 206 per cent in July alone.
“I think people sometimes forget that China is the biggest importer of cotton in the world,” said David Birnbaum, a consultant in the Asian garment industry. “If the US put a full ban in [on Chinese textiles products], China would certainly retaliate straight away and probably stop buying US cotton, which would be a horrendous result.”
02:56
Germany presses China on Hong Kong security law, seeks access to Uygurs in Xinjiang
Companies have until September 30 to extricate themselves from dealings with XPCC, unless they are granted approval to keep trading by the Department of Treasury.
Doug Palmer reports for Politico from Washington, Finbarr Bermingham reports for the South China Morning Post from Hong Kong.
