By Menaka Yerramilli de Rege, M.A. student at McMaster University, Institute of Globalization and the Human Condition
January 10, 2022
The Spanish multinational corporation Inditex, the parent company of the popular fashion brand Zara, has long faced allegations of forced labour in its supply chains. These allegations have largely followed the release of a groundbreaking Investigative report by the Australian Strategic Policy Institute (ASPI) in 2020, which unearthed claims surrounding the use of Uyghur forced labour in the Xinjiang region of China. In this report, Inditex was named as one of 82 well-known global brands whose products were being produced in factories across China which have been accused of using forced Uyghur labour.
The Xinjiang region of China produces a large supply of cotton used across the garment industry with “roughly one in five cotton garments…[containing] cotton or yarn from Xinjiang.” The ASPI names brands, such as Zara, as potentially benefiting directly or indirectly from this unfree labour in their supply chains.
Following the ASPI report, the Worker Rights Consortium (WRC), a reputable independent labour rights monitoring organization, issued a brief directly linking Inditex to two yarn and textile manufacturing companies in China that rely upon forced Uyghur labour.
As the use of Uyghur forced labour continues to be publicized, European campaigns to raise awareness of forced labour in global supply chains have simultaneously gained traction,“leading to consumers suggesting boycotts of brands who have profited from the use of forced labour” .
Zara has garnered attention from individuals and NGOs, such as the Éthique sur l’Etiquette collective, who “organized a boycott” against the brand in November 2020, citing their complicity in Uyghur forced labour as their motive for boycotting.
In July of 2021, France’s antiterrorism prosecutor’s office opened an investigation against Inditex and three other multinational corporations that have been accused of profiting from the use of Uyghur forced labour. The French investigation follows an April lawsuit filed by multiple NGOs, including the Éthique sur l’Etiquette collective. Inditex has denied these accusations despite the mounting evidence against them.
The continued reliance on Uyghur forced labour in global garment industry supply chains despite global outrage is extremely concerning and cannot be taken lightly. It begs questions about the root causes and structural deficiencies in our global political economy that create the conditions for the use of forced labour in the first place.
The use of Uyghur forced labour in China is part of a larger government initiative to forcibly assimilate Uyghur Muslim people and other minority populations with the Han Chinese majority ethnic group.
The tensions between the majority Han ethnic group, the People’s Republic of China (PRC), and minority Muslim populations in China are not new; the tensions have led to government adoption of coercive worker transfer programs for Uyghurs since the early 2000s as a means for inter-ethnic fusion.
However, in recent years their initiatives have attracted international condemnation, as they are alleged to be state-sponsored attempts at cultural genocide. Beginning in 2017, millions of Uyghurs disappeared into state-sponsored ‘re-education camps’ where they were subjected to political indoctrination, torture, and religious persecution. This government initiative has been justified by the PRC as aiming to combat religious extremism, alleviate poverty, and promote inter-ethnic fusion.
The use of Uyghur forced labour is extremely prevalent in factories located in the Xinjiang region. More recently, the government has facilitated a mass transfer of Uyghurs to factories across Chinese provinces under the guise of a policy termed ‘Industrial Xinjiang Aid’.
This policy assigns so-called “idle Uyghurs” to workplaces “in the name of poverty alleviation, but it also shares the same indoctrination aims as the ‘re-education camp’ system.” The Xinjiang government has given political and business incentives for the use of transferred Uyghur labour, paying a tax per head to private brokers, local governments, and factories who utilize labour supply being sent through the labour transfer scheme.
Uyghur workers in these factories are subjected to intimidation and threats, both against themselves and their families, restricted mobility via fenced-in factories and state-monitored trains, isolation in segregated dormitories, and surveillance through military style management. These labour conditions clearly meet the “International Labour Organization (ILO)'s definition” of forced labour. Furthermore the ASPI identified that the working conditions faced by Uyghurs align with various “ILO indicators of forced labour” .
The province of Xinjiang produces 85 percent of China’s cotton supply, which suggests that Uyghur forced labour in China may affect “all supply chains that involve Xinjiang cotton as raw material.” Likewise, the PRC’s increasing reliance on labour transfer schemes poses challenges to eradicating forced labour from supply chains, as there is an increasing mix of forced Uyghur labour alongside Han majority voluntary laborers. These factors make it difficult for companies to guarantee the absence of forced Uyghur labour directly or indirectly in their supply chains.
As public outcry grows around the use of Uyghur forced labour, companies are surprisingly hesitant to cut ties with or condemn the Xinjiang region. The reality is that increasing instances of forced labour in the global garment industry are not as rare as they are often portrayed and, instead, are characteristic of neoliberal capitalism.
Forced labour in the garment industry is largely a result of a business demand for cheap, flexible, and highly profitable labour. Multinational corporations, like Inditex, create ideal conditions for forced labour by dictating prices and margins in their Global Value Chains (GVC) that allow them to remain highly profitable.
Inditex's founder Amancio Ortego has a net worth of more than US$83 billion, demonstrating the extreme profitability of the company. This profitability comes at a cost further down in the supply chain. Factories and suppliers also want to remain profitable and are required to lower their cost margins to do so. In doing this they often squeeze the capacities of their most negotiable and biggest cost – their workforces.
Additionally, MNCs often decide where to source and manufacture goods based on where labour is cheapest and sometimes under-protected. These pressures result in exploitative labour practices becoming part of the business model to meet demands. Further, these pressures demonstrate some of the systemic causes leading to a reliance on Uyghur forced labour.
Inditex released a statement which read “at Inditex we take a zero-tolerance approach toward forced labor of any kind and have stringent policies and actions in place to ensure that it does not take place anywhere in our apparel and textiles supply chain.” The statement stressed that “various of these types of reports that allege negligence of social and labor rights in various parts of the supply chain, related to the Uyghurs in Xinjiang (China) and in other regions, [are] very concerning.” The company statement concluded that “after an internal investigation, we can now confirm that Inditex does not have any commercial relationship with any factory in Xinjiang.” Soon after the release of the statement above, it was deleted by Inditex. Although the company still has a statement about modern slavery on their website, it makes no specific reference to Uyghur forced labour or the Xinjiang region of China, leading NGOs such as the Coalition to End Forced Labor in the Uyghur Region to accuse the company of "colluding with the Beijing regime and prioritizing its economic interests over human rights.”
Both the Coalition to End Forced Labor in the Uyghur Region and the WRC have anticipated some of the challenges that will come with guaranteeing the absence of Uyghur forced labour in brands’ global supply chains. Given the scope of forced labour abuses in the Xinjiang region, they suggest that buyers should "operate on the assumption that all products produced in part or in whole in the Uyghur Region are at high risk of being tainted by forced labour," a position supported by the Ethical Trading Initiative, which Inditex has been a signatory of since 2005. The Executive Director of the WRC suggests that “people who are victims of forced labor in the Uyghur region risk serious reprisals if they disclose their situation” posing a challenge to the validity of labour inspections in the region.
Similarly, “five auditing companies have blacklisted the Uyghur region due to restrictions and the climate of terror imposed by the Chinese government, which prevents workers from speaking freely to people.” These conditions question the validity of social audits, a method of private regulation that Inditex utilizes to verify compliance in their supply chains.
Given the mixed messaging of the company, the question remains: Does Inditex use Uyghur forced labour in its supply chains? And considering the mass movement of Uyghur forced labourers and reliance on Xinjiang raw materials described above, can the company really rule out indirect links in their supply chains? Inditex’s silence on the issue of Uyghur forced labour speaks volumes.
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This project is supported by the LIUNA Enrico Henry Mancinelli chair in Global Labour Issues at McMaster University, held by Judy Fudge, and by funding from the Social Sciences and Humanities Research Council.