The Uyghur Forced Labor Prevention Act was unanimously passed in the U.S. Senate in December 2021. The act was a direct attack on China's economy in response to evidence that China was using forced labor practices in its autonomous Xinjiang region.
The act went further than most import restriction strategies and tariffs. Firstly, it outlawed imports from the entire Xinjiang region, being explicit in its language that this included anything "manufactured wholly or in part." Most tariff restrictions only include final goods, so this act went beyond the normal scope of protectionist policy. Secondly, it implemented a plan for U.S. importers to follow to ensure that imports were produced ethically, which ensures due diligence on the behalf of American companies. It also burdened the importer to prove that the good was not produced in Xinjiang, a process that can be complicated and time-consuming, discouraging free trade.
Admittedly, only about 0.01% of the U.S.'s total imports come from Xinjiang as goods, which might cause concern. Is the act actually fulfilling its purpose? However, when one considers that the Xinjiang region is a large producer of the world's raw materials (i.e., Xinjiang produces 1/5 of the world's cotton), the impact becomes much more noticeable.
U.S. supply chains are expected to take a hit due to this act, but only in certain sectors. For instance, renewable energy (i.e., solar panels) will be hit especially hard, but agriculture will not because the U.S. has already prepared in advance to reduce dependency in this area.
As for forced labor, the act's impacts are not as certain. It will reduce U.S. dependence on products created in China, forcing Chinese manufacturers to adopt better labor policies. However, Xinjiang exports mostly to Central Asia and Russia. If the U.S. is to actually follow through with this plan to reduce forced labor, it should rally the international community to adopt similar protectionist policies.
If the Uyghur Forced Labor Prevention Act teaches us anything, it should be that economics is not as cut and dry as "free trade or bust." This act reduced free trade but could potentially improve the human rights situation in Xinjiang. Furthermore, it could set a precedent for countries going forward that people's livelihoods are more important than output, and that's a good thing.
https://www.csis.org/analysis/uyghur-forced-labor-prevention-act-goes-effect
This is an interesting story. As I began reading I did feel it was meaningful that the U.S. is taking action here and using their power for good. Although, it is fascinating that they're focusing so much on a place that produces only about 0.01% of the U.S.'s total imports, making the action seem a lot smaller. In the end, they do deserve some credit considering how this will negatively affect our supply chains as they take a good stand in the face of poor labor policies by the Chinese.
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