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Xinjiang Response ‘Cannot Be Limited’ to XUAR: Report

The response to reports of forced Uyghur labor “cannot be limited” to companies based in the Xinjiang Uyghur Autonomous Region (XUAR), a recent report from the Center for Advanced Defense Studies (C4ADS) claims.

The report, which suggests brands like Esprit and Tesco have sourced materials from corporations linked to Xinjiang, arrived little more than a week after the Uyghur Forced Labor Prevention Act went into effect. Signed into law in December, the bill prohibits any product made in whole or in part in Xinjiang from entering the United States unless importers provide “clear and convincing evidence” the good was not mined, produced or manufactured using forced labor.

“However, as long as the flow of goods produced in the region to exporters elsewhere in China is left unaddressed, tainted goods will continue to enter global supply chains,” Nicole Morgret, a human rights analyst with C4ADS, wrote in her report, “Shifting Gears.” “Global stakeholders must improve due diligence and enforcement efforts to ensure they are not enabling forced labor and oppression in the Uyghur region.”

Morgret’s report centers on the Chinese government’s Pairing Assistance Program. Begun in 1997 and expanded in 2010, the initiative pairs XUAR counties and municipalities with provinces and municipalities on the east coast, channeling resources and personnel from the wealthier localities into XUAR. “Industrial assistance,” the report notes, has assumed “an increasingly central role” in these efforts, including in the form of investment in industrial parks and support for companies moving to the region.

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Though officially framed as charity, the program “serves as yet another tool for monitoring and indoctrinating Uyghurs and other Turkic peoples,” Morgret wrote. Both government-owned and private factories have become sites of “forced assimilation,” she added, with pairing program officials reportedly organizing and carrying out training for workers “similar to those used in the camps.”

According to corporate data gathered by C4ADS, the number of new manufacturing companies established in Xinjiang has, except for a dip in 2018, grown every year since 2013. The temporary slowdown, the report notes, coincided with the beginning of the government’s reported mass detention campaign. “The government may have been placing a greater emphasis on securitization during those years, temporarily slowing industrial transfer,” Morgret suggested.

Within textiles and apparel, however, the number of new manufacturing companies established peaked in 2016 at 870. The number has fallen every year since, with XUAR adding 439 textile and apparel manufacturing companies last year.

The overall influx of manufacturers, the report claims, “has failed to economically empower the Uyghur and Turkic peoples.” According to C4ADS’ data, the number of new manufacturing companies with a Turkic “legal representative” peaked at 24 percent in 2016, the year before China’s Uyghur crackdown began. Though the total number of new companies inched up in 2017, the number of Turkic legal representatives fell by nearly half to 464. C4ADS calculated Turkic representation by identifying the number of names with a special dot character that the “majority” of Turkic names use when transliterated into Chinese.

Of the 40,293 manufacturing companies established in Xinjiang since 2009, 12.5 percent have had legal representatives with a Turkic name and 14 percent have had a shareholder with a Turkic name, the report said. The Turkic population accounts for more than half of the region’s population. The disparity is more striking in predominantly Uyghur prefectures. Kashgar, for example, is 92.6 percent Uyghur, but just 23.5 percent of its manufacturing companies have a Uyghur legal representative, C4ADS found. In Honan, 96 percent of the population is Uyghur, but 36 percent of new companies since the 2017 crackdown have had a legal representative belonging to the ethnic group.

This data, Morgret contended, “reveals the political nature of industrial transfer in XUAR and the patterns and pathways through which it takes place” and “indicates Uyghurs and other Turkic peoples are not sharing in the economic benefits of the industrial boom.”

“Shifting Gears” discusses three “overlapping” pathways through which industrial transfer takes place in XUAR: industrial parks, state-owned enterprises and private companies.

Industrial parks, “most” of which are directly controlled by their local governments or relevant bureaus and function as government entities, serve as “an enclosed and controlled setting for repression and assimilation,” Morgret wrote. They are also “closely connected” to the pairing program, she added, with paired parks facilitating the transfer of resources and expertise from eastern Chinese parks.

“If an industrial park in eastern China has this type of pairing relationship with a park in XUAR, there is an increased likelihood that companies within the park are part of industrial transfer programs or other collaborations in the Uyghur region,” Morgret said.

The report identified state-owned companies as “significant players” in the pairing program. In one of the report’s several case studies, Morgret highlights Xinxiang Chemical Group, a Henan-based chemical fiber manufacturer owned by the Xinxiang City Finance Bureau. The company reportedly has two subsidiaries in XUAR, both of which are based in the XPCC-controlled city Tumshuk in the Dabanshan Industrial Park. According to “Shifting Gears,” the manager of one of the Xinjiang-based subsidiaries stated the company received subsidies and tax reductions and exemptions for establishing in XUAR.

These subsidiaries, Morgret wrote, are “closely linked” to Xinxiang Chemical Group, with government reporting stating it sources products from the two Xinjiang subsidiaries. Xinxiang Chemical Group and its subsidiary Xinxiang Chemical Fibre export viscose to companies like Esprit and Tesco, the report claimed. A Tesco spokesperson, however, said the company has not “made any orders connected to this site” in more than 12 month and that it had been removed from its approved list of sources. “We take allegations of human rights abuses in our supply chain extremely seriously and conduct regular and thorough checks to ensure workers are treated fairly,” the spokesperson said. Esprit did not respond to a request for comment.

“In the face of both moral and legal obligations to stop sourcing products from XUAR or otherwise work with companies that support oppression in the region, importers and global companies must redouble their efforts to trace their supply chains,” Morgret wrote. “Doing so will require a more comprehensive understanding of the ways state and private corporations are complicit in China’s ongoing campaign of human rights abuse against Uyghurs.”