State Department encourages companies to avoid business with Chinese firms reliant on forced labor

The State Department is urging U.S. companies to avoid doing business with Chinese suppliers that use forced labor from Uighur Muslims, a minority ethnic group in China that is facing harsh discrimination.

“The advisory will make businesses aware of the potential exposure in their supply chains to entities that engage in human rights abuses in Xinjiang — or elsewhere in China — and the associated reputational, economic, and legal risks of such involvement,” Secretary of State Mike Pompeo said in a statement on Wednesday. 

Pompeo cited Beijing’s “campaign of systematic repression of Uyghurs and members of other Muslim minority groups,” which has gained notoriety in recent years over its use of detention centers.

The advisory specifically cautioned companies about the risks of supply chain links to firms that are believed to rely on forced labor or goods sourced in Xinjiang, where most Uighurs live, and aid the construction of internment facilities.

“Businesses with potential exposure in their supply chain to entities that engage in human rights abuses in Xinjiang or to facilities outside Xinjiang that use forced labor from Xinjiang in the manufacture of goods intended for domestic and international distribution should be aware of the reputational, economic, and legal risks of involvement with such entities,” the advisory reads.

Wednesday’s advisory comes after the Commerce Department earlier this year put 37 Chinese companies on an “Entity List” for being involved in or empowering human rights abuses. Firms on the list will have their access to U.S. goods restricted under more stringent licensing requirements.

The advisory lands at a time of heightened tension between the U.S. and China, with the Trump administration accusing Beijing of failing to do enough to blunt the spread of the coronavirus and hammering a new security law that critics fear will tamp down on freedoms in Hong Kong. The two countries have also slapped tit-for-tat restrictions on each other’s media outlets.