China to Investigate American Retailer for Potential Discrimination Against Xinjiang Products #

China has announced an investigation into a major American retailer that owns several well-known fashion brands, examining whether the company has taken discriminatory measures against products from Xinjiang in China’s far west.

This move represents an escalation in China’s efforts to counter bans and consumer boycotts of goods from Xinjiang. Many Western governments have implemented restrictions on products from this region due to concerns about mass arrests and forced labor among predominantly Muslim ethnic groups, particularly the Uyghurs.

The investigation sends a message to multinational corporations that compliance with consumer boycotts or government bans on Xinjiang products may result in retaliation within China. This action highlights the increasing pressure on large companies caught between the Chinese government’s defense of its Xinjiang policies and concerns raised by Western countries and human rights groups.

Recently, an international group of lawmakers called for a major German automaker to withdraw from Xinjiang. The company has a joint venture in the region with a Chinese state-owned enterprise.

China’s position as both a large consumer market and the world’s largest manufacturer makes many companies, especially in the apparel sector, potentially vulnerable to sanctions on their subsidiaries or suppliers.

In the United States, legislation bans the import of goods from Xinjiang unless importers can prove they were made without forced labor. The European Union is in the process of implementing a similar ban.

When Western consumer and human rights groups began organizing boycotts of brands using Xinjiang cotton, many clothing companies initially tried to distance themselves from suppliers in the region. However, China responded by allowing nationalist groups to organize counter-boycotts of Western brands that avoided Xinjiang products.

China has passed laws prohibiting compliance with foreign sanctions or boycotts, and its commerce ministry can deem certain commercial decisions as threats to national security.

The investigation into the American retailer allows 30 days for the company to provide documents regarding its purchasing practices in Xinjiang. Potential penalties for violations could include restrictions on imports, exports, investments, and employee travel, as well as possible fines.

Despite the strong stance against the retailer, the Chinese government maintains that its actions are aimed at preserving free trade rather than suppressing it, emphasizing its commitment to opening up and safeguarding the multilateral trading system.