The Chinese government is boycotting Western clothing retailers for expressing concerns about forced labor in Xinjiang, China's biggest region. The companies are being pressured to scrub from their websites language about corporate policies on human rights, reverse decisions to stop buying cotton produced in Xinjiang, and remove maps that depict Taiwan as an independent country.
The escalating fight comes after the European Union and the United Kingdom on March 22 joined the United States and Canada to impose sanctions on Chinese officials for human rights abuses in Xinjiang, a remote autonomous region in northwestern China.
Western companies doing business in China increasingly face an unpalatable dilemma: how to uphold Western values and distance themselves from human rights abuses without provoking retaliation from the Chinese government and losing access to one of the world's biggest and fastest-growing markets.
The current dispute revolves around allegations that the Chinese government is forcing more than 500,000 Uyghurs and other Muslim ethnic and religious minorities to pick cotton in Xinjiang, which produces 85% of China's cotton and one-fifth of the world's supply. Roughly 70% of the region's cotton fields are picked by hand. The allegations of forced labor affect all Western supply chains that involve Xinjiang cotton as a raw material. Both the European Union and the United States import more than 30% of their apparel and textile supplies from China.
In October 2020, the Geneva-based Better Cotton Initiative (BCI), an influential non-profit group that promotes sustainable cotton production, suspended licensing of Xinjiang cotton, citing allegations and "increasing risks" of forced labor. The statement has since been scrubbed from the BCI website, and, disturbingly, also is not accessible on the Internet Archive.
After the BCI, which has more than 1,800 members, spanning the entire global cotton supply chain, stopped licensing Xinjiang cotton production, its members — including Germany-based Adidas, U.K.-based Burberry, Swedish retailers H&M and IKEA, and U.S.-based Nike — all said that they would stop using cotton from Xinjiang, in line with the group's guidelines.
At the time, H&M, the world's second-biggest fashion retailer, posted a statement on its website:
"H&M Group is deeply concerned by reports from civil society organizations and media that include accusations of forced labor and discrimination of ethno-religious minorities in Xinjiang Uyghur Autonomous Region (XUAR). We strictly prohibit any type of forced labor in our supply chain, regardless of the country or region....
"We do not work with any garment manufacturing factories located in XUAR, and we do not source products from this region. We transparently disclose names and locations of manufacturing factories, mills and yarn producers in our public supplier list and will continue to do so and further accelerate this transparency for our global supply chain.
"In addition, we have conducted an inquiry at all the garment manufacturing factories we work with in China aiming to ensure that workers are employed in accordance with our Sustainability Commitment, and that they comply with our migrant worker guideline."
The statement, largely unnoticed at the time, was unearthed after the EU's announcement of sanctions. The Communist Youth League, the youth movement of the Chinese Communist Party, in a post on Weibo, the Chinese equivalent to Twitter, stated: "Spreading rumors to boycott Xinjiang cotton, while also wanting to make money in China? Wishful thinking!"
The furor over H&M's ban on Xinjiang cotton quickly rose to a fever pitch on Chinese social media, with many calling for a nationwide boycott of the company. Chinese map and ride-hailing applications blocked H&M. Major Chinese e-commerce platforms dropped the brand from their platforms. Angry landlords terminated lease agreements and forced H&M to shutter some of its 500 stores in China, the company's fourth-largest market behind Germany, the United States and Britain.
The Chinese nationalist backlash soon spread to other Western apparel and footwear companies — including Adidas, Burberry, Calvin Klein, Lacoste, New Balance, Nike, Puma, Tommy Hilfiger, Uniqlo and Zara — after state media criticized the brands for expressing concern about Xinjiang. More than 30 Chinese celebrities announced that they were ending endorsement deals with Western brands. Some said they opposed attempts to "discredit China."
The Associated Press reported that China was "erasing" Western brands from the internet:
"In a high-tech version of the airbrushing used by China and other authoritarian regimes to delete political enemies from historic photos, H&M's approximately 500 stores in China didn't show up on ride-hailing app Didi Chuxing or map services operated by Alibaba and Baidu. Its smartphone app disappeared from app stores.
"It wasn't clear whether companies received orders to erase H&M's online presence, but Chinese enterprises are expected to fall in line without being told. Regulators have broad powers to punish companies that fail to support official policy....
"The Communist Party often pressures foreign clothing, travel and other brands over actions by their governments or in an effort to compel them to adopt its positions on Taiwan, Tibet and other sensitive issues.
"Most comply because China is one of the biggest, fastest-growing markets for global fashion, electronics and other consumer brands."
Xu Guixiang, a Xinjiang government spokesman, said:
"I don't think a company should politicize its economic behavior. Can H&M continue to make money in the Chinese market? Not anymore. To rush into this decision and get involved in the sanctions is not reasonable. It's like lifting a stone to drop it on one's own feet."
H&M, in a statement dated March 31, said that it was "dedicated to regaining the trust and confidence of our customers, colleagues, and business partners in China." The statement, which did not mention Xinjiang, appeared to be a failed attempt to strike a balance between placating the Chinese government while assuaging Western human rights groups.
"Why doesn't H&M apologize openly to consumers?" asked the state-owned China Central Television. It called H&M's statement a "second-rate public relations article full of empty words lacking sincerity."
Ministry of Commerce spokesman Gao Feng said that forced labor in Xinjiang was "non-existent and entirely imaginary" and that such allegations amounted to slander:
"We oppose any external forces interfering in Xinjiang-related matters and China's internal affairs. We also oppose sanctions imposed on Chinese individuals and entities based on lies and false information, and on the pretext of so-called human rights issues in Xinjiang."
Chinese authorities subsequently pressured H&M and other brands to change "problematic maps of China" on their websites. The Shanghai branch of the Cyberspace Administration of China objected to how Taiwan, the independent island country that Beijing claims as part of its territory, is depicted on the Taiwanese versions of their websites.
After H&M caved to Chinese pressure and changed the map, the government ordered H&M to "immediately remedy" its depiction of disputed waters in the South China Sea, 90% of which is claimed by Beijing. H&M complied, only to anger Vietnam, which holds rival claims to some of the waters.
Meanwhile, in a bid to counter accusations of human rights abuses in Xinjiang, the Chinese government has produced a new musical — apparently mimicking the American classic "Sound of Music" — which portrays Xinjiang as a rural idyll of ethnic cohesion devoid of repression, mass surveillance and even the Islam of its majority Uyghur population.
The musical, "Wings of Songs," is attempting to reframe the cultural reality of the region, according to the Agence France-Presse, which added:
"The musical omits the surveillance cameras and security checks that blanket Xinjiang. Also noticeably absent are references to Islam — despite more than half of the population of Xinjiang being Muslim — and there are no mosques or women in veils."
Western Brands and Xinjiang Supply Chains
In March 2020, the Australian Strategic Policy Institute, in a report, "Uyghurs for Sale," revealed that Uyghurs were working in factories — under conditions of forced labor — that are in the supply chains of more than 80 well-known global brands in the clothing, automotive and technology sectors. The companies include:
Abercrombie & Fitch, Acer, Adidas, Alstom, Amazon, Apple, ASUS, BMW, Bombardier, Bosch, Calvin Klein, Candy, Carter's, Cerruti 1881, Cisco, Dell, Electrolux, Fila, Founder Gap, General Motors, Google, H&M, Hitachi, HP, Jaguar, L.L. Bean, Lacoste, Land Rover, Lenovo, LG, Mercedes-Benz, MG, Microsoft, Mitsubishi, Nike, Nintendo, Nokia, Panasonic, Polo Ralph Lauren, Puma, Samsung, Sharp, Siemens, Skechers, Sony, Tommy Hilfiger, Toshiba, Uniqlo, Victoria's Secret, Volkswagen and Zara.
In July 2020, the Financial Times reported that Western brands including Brooks Brothers, Hugo Boss, Lacoste and Ralph Lauren had received apparel shipments from a Chinese company whose subsidiary is facing U.S. sanctions over alleged forced labor in Xinjiang.
In May 2019, the Wall Street Journal reported that many multinational brands — including Adidas, C&A, Calvin Klein, Campbell's Soup Company, Coca-Cola, Disney, Esprit, Gap, H&M and Kraft Heinz and Patagonia — were directly or indirectly benefiting from factories allegedly using forced labor in Xinjiang.
Some companies have denied the allegations, others have promised to investigate and still others have pledged to stop sourcing supplies from Xinjiang. Following are select responses and statements from fashion-related brands, the current focus of Chinese ire:
Adidas. A statement said: "In 2019, on learning of allegations against several companies sourcing from Xinjiang, China, where ethnic minorities were reportedly subject to forced labor in spinning mills, we explicitly required our fabric suppliers not to source any yarn from the Xinjiang region. Adidas has never manufactured goods in Xinjiang and has no contractual relationship with any Xinjiang supplier."
Burberry. The U.K.-based retailer, a member of the Better Cotton Initiative, was the first luxury brand to suffer Chinese backlash over Xinjiang. Burberry lost a Chinese brand ambassador, and its logo was scrubbed from a popular video game.
Gap. A statement said: "We can confirm that we do not source any garments from Xinjiang.... We have implemented a new policy that explicitly prohibits Gap Inc. vendors from directly or indirectly sourcing any products, components, or materials from Xinjiang in the process of manufacturing any orders for Gap Inc.
Marks & Spencer. The British retailer was one of the first major brands to back a campaign to stop forced labor in Xinjiang. In January 2020, the company signed a call to action by 'The Coalition to End Forced Labour in the Uyghur Region' — which consists of more than 300 civil society groups — to cut ties with suppliers in China that profit from forced labor in Xinjiang.
Nike. A statement said: "We are concerned about reports of forced labor in, and connected to, the Xinjiang Uyghur Autonomous Region (XUAR). Nike does not source products from the XUAR and we have confirmed with our contract suppliers that they are not using textiles or spun yarn from the region."
New Balance. A statement said: "We recognize that the risk of forced labor increases as we go further upstream in the supply chain where we also have less visibility and leverage. We are expanding the mapping of the cotton yarn supply chain as well as exploring technologies and other methods to better assure raw material origins."
Zara. Zara's parent company, Spain-based Inditex, removed from its website a statement on the company's zero-tolerance policy for forced labor. The statement, which can be found on the Internet Archive, said:
"We take reports of improper social and labor practices in any part of the garment and textile supply chain extremely seriously. We are aware of a number of such reports alleging social and labor malpractice in various supply chains among Uyghurs in Xinjiang (China) as well as in other regions, which are highly concerning. Following an internal investigation, we can confirm that Inditex does not have commercial relations with any factory in Xinjiang."
Hong Kong human rights campaigner Johnson Yeung tweeted:
"Faced pressures from Chinese state media and Chinese consumers. @InditexSpain @ZARA secretly remove their statement on #Xinjiang Cotton from their website. I genuinely worry that companies will participate in atrocity against Uyghurs again to pledge their loyalty. Hold the line."
China scholar Richard Ebeling, writing for the American Institute for Economic Research, explained why the Chinese government is persecuting the Uyghurs:
"The Uyghurs, like the Tibetans, and other minority groups in China, have been the victims of Chinese political and ethnic imperialism. The Chinese government has attempted to assure the political unification and integration of, especially, Tibet and Xinjiang by a policy of ethnic and cultural 'sterilization.' For decades, the Chinese authorities in Beijing have instigated Han Chinese population migrations to these two areas to 'dilute' and reduce to a demographic minority the Uyghur and Tibetan peoples within their own lands.
"The Chinese government has attempted to persecute and eradicate the practice of Islam and Buddhism, respectively, among these peoples. The Chinese military has desecrated religious temples and places of worship, murdered and imprisoned religious leaders, forced women of both groups to marry Han Chinese to genetically 'cleanse' Xinjiang and Tibet of their indigenous populations, and have restricted or prohibited the learning and speaking of the distinct local languages and practicing of cultural customs.
"Though, of course, never said officially or publicly, the Chinese government's policy, to guarantee political solidarity and unity throughout each and every corner of the territory of China is to make the country one racially single group, the Han Chinese."
The Economist magazine, in an editorial, wrote that Western retailers increasingly are caught between nationalistic Chinese consumers and conscientious ones at home:
"For more than a year some big foreign apparel and technology companies have been walking a fine line on the human-rights abuses committed by China against Uyghurs, a mostly Muslim ethnic minority in the north-western region of Xinjiang. These firms have been working to clear their supply chains of the forced labor of Uyghurs, hundreds of thousands of whom pick cotton under apparently coercive conditions. What they have not done is boast about these efforts, fearful of angering the Communist Party and 1.4bn Chinese consumers....
"An online furor stoked by Chinese authorities this week suggests that Beijing may be tiring of this double game. China's government, increasingly keen to punish critics of their Xinjiang policies, is forcing foreign companies to make a choice they have been studiously trying to avoid: support China or get out of the Chinese market.
"Chinese authorities have stirred nationalist protests against foreign companies in the past, then tamped them down having made their point. This time the campaign looks like part of a broader, more enduring counterattack against critics of the government's policies in Xinjiang, where it incarcerated more than 1m Uyghurs in a gulag for their religious and cultural beliefs....
"The Communist Party views itself as increasingly able to exert economic pressure on others, using the 'powerful gravitational field' of the world's second-largest economy....
"Western brands that have held their ground on Xinjiang may worry that being seen as kowtowing to the Communist Party could provoke a backlash among shoppers in the West, who increasingly expect companies to behave responsibly on everything from the treatment of workers to climate change.... The firms may also be calculating that the nationalist fervor in China will cool. And they are hedging their bets....
"That could all change as both China's official anger at criticisms of its Xinjiang policies and pressure from Western human-rights campaigners and consumers continue to intensify. Human-rights campaigners are already calling for a corporate boycott of next year's winter Olympics in Beijing.... They know that responding to Chinese pressure by renouncing their own human-rights commitments looks indefensible in their home markets. At the same time, they are understandably worried about the consequences in China. The choice between the lucrative Chinese market and the values firms profess in the rest of the world is becoming unavoidable...."
The Swiss public broadcaster SWF wrote that the conflict worked in favor of the Chinese government:
"The public outrage and the boycott benefit the Chinese government in several ways: Domestically, the boycott distracts from the allegations of human rights violations and presents the issue as an attack by the West on China.
"The H&M case also serves as a chilling example in relation to other countries. The message to international companies: Do not mess with China."
The Frankfurter Allgemeine Zeitung highlighted the moral conflict faced by Western countries:
"Western companies are in a conflict: In the West, many of their customers refuse to wear a T-shirt that was produced by forced laborers. In China, which is a production location and an important market for them, companies come under pressure when they openly criticize forced labor. They can hardly please both sides.
"Consider Hugo Boss. The brand from the Swabian town of Metzingen, known for its men's suits, is currently demonstrating how a company is looking for a way out of a moral and economic dilemma — and in the end loses twice.
"The Chinese internet platform Weibo — a kind of national Twitter — recently called for a boycott of Hugo Boss. Two prominent actors terminated their collaboration with the German company, and users on China's social media scoffed at the suit manufacturer's puffing around.
"A few days ago, Hugo Boss said on Weibo that they respect the national sovereignty of China, that the cotton from Xinjiang is among the best in the world — and that it will continue to be bought. This statement would probably have hardly been noticed in the West had the English-language media portal Hong Kong Free Press not reported on it.
"The company told an American broadcaster last September that all their suppliers had to prove that their products did not come from Xinjiang. Suddenly the impression arose that Hugo Boss was saying something different in China than in the West.
"After the Hong Kong publication reported the conflicting statements, Boss deleted the one on Weibo. Instead, the company is now referring to an English-language statement on its Weibo account, in which it says with reference to Xinjiang: 'Hugo Boss does not tolerate forced labor.' ....
"When asked by Die Zeit, a spokeswoman for Hugo Boss said the first Weibo message was 'unauthorized.' He added: 'Our position with regard to the situation is of course unchanged from that of some time ago.'
"But with little effort, an older version of the group's statement can be found on the internet, which was deleted from its website a few days ago — and which is much harsher than the message that is now being spread.... It promised: 'We guarantee that from October 2021 our new collections will not contain any cotton or other materials from the Xinjiang region.'"
The German newspaper Die Welt wrote that as long as Germany is dependent upon China, moral criticism is of little use:
"An example of the [transatlantic] disagreement over the right approach to China is the China Investment Agreement, which the EU, under the leadership of Angela Merkel, waved through ... ignoring all requests from the Biden administration.
"The agreement may superficially improve the situation for European investors in China a little. Above all, however, it represents a prestigious achievement for Xi Jinping and makes it easier for him to point out, if necessary, that the West is unable to find a common position on China.
"Not even its defenders would claim that the agreement would help to positively influence the human rights situation in China. In these days in particular, Europeans are experiencing anew that China is not prepared to even enter into a dialogue with the West on human rights issues. On the contrary, Beijing reacts increasingly aggressively to any kind of criticism....
"The 5,200 German companies that are active in China will have given the German Chancellery a very clear picture of the sensitivities of their Chinese business partners in recent years. That's why Daimler quickly cleans up a social media post about Tibet if Beijing unpleasantly notices it. And that's why you hear nothing from Volkswagen about the situation of the Uyghurs, although, or rather because, the company has a plant in the province of Xinjiang. German companies account for a good one-half of the EU's exports to China. The German export industry has little interest in tarnishing this balance sheet with moral zeal.
"The economic dependence on China, however, further weakens the already low impact of moral arguments. As long as Europe, and in this case Germany in particular, is not prepared to reduce this dependency, complaints about human rights violations in China will, at best, continue to trigger sloppy defensive reactions from Beijing."