The U.S. recently accused Xinjiang of using forced labor, which has led lawmakers to support blocking imports from the region. American companies also were warned of legal risks if they do business in this area, the Associated Press reported.
The U.S. Senate approved a measure earlier this month that would block imports of goods made with forced labor in Xinjiang. If the bill is approved by the House of Representatives, U.S. companies will need to adjust. Xinjiang is a major supplier of cotton, clothing, sugar and other goods. The Xinjiang Supply Chain Business Advisory report released earlier this month by the U.S. Commerce Department and five other agencies listed several industries using forced labor in the region—some of which include agriculture, construction, textiles and renewable energy.
The report warns companies they "run a high risk" of violating U.S. laws against forced labor if they have ties to the region.
"Businesses … with potential exposure to or connection with operations, supply chains or laborers from the Xinjiang-region, should be aware of the significant reputational, economic and legal risks of involvement with entities … linked to Xinjiang that engage in human rights abuses," the report states.
However, China denies the accusations and blames the U.S. for damaging global trade.
"The so-called human rights and forced labor issues in Xinjiang are completely inconsistent with the facts," said a Ministry of Commerce spokesman, Gao Feng. "The U.S. approach has seriously undermined the security and stability of the global industrial chain and supply chain."
---Annacaroline Caruso, editorial associate---