Analysis | US-China relations: how will Washington’s ‘forced labour’ law impact Xinjiang’s economy?
- The Uygur Forced Labour Prevention Act effectively blocks American imports of all products wholly or partially sourced from Xinjiang due to allegations of forced labour
- The law is likely to apply some drag on exports and investment in Xinjiang, but the economy is not export-dependent and is insulated by central government transfers
After a sweeping US ban on products from China’s Xinjiang region came into effect last month, all eyes are again on the autonomous territory in the country’s far west.
The ban, which lasts for eight years, is expected to unleash far-reaching effects on the global supply chain, as Xinjiang produces around half of the world’s polysilicon – a material crucial to solar panel production – a quarter of the world’s tomato and a fifth of global cotton.
The three sectors, together with apparel, have been identified by US Customs as at “high-risk” of exposure to forced labour and will be scrutinised under the act.
In the future, the region could face even more scrutiny, with lawmakers in the European Union mulling a similar ban.
We take a look at what all this could mean for Xinjiang’s economy.
How will the ‘forced labour’ law affect Xinjiang’s exports?
The ban directly impacts exports from the region, so some drag on the economy is expected. But in reality, Xinjiang’s economy is not export-driven despite bordering eight nations – more than any other provincial-level jurisdiction in China.