Why Are Fashion Brands Still Opening Stores in Xinjiang?
Outfitted in a bright orange hoodie, dark shades and his trademark swagger, Donnie Yen waved to a riotous crowd as he inaugurated a new Skechers store at a Chinese mall in late September. The event, which the Hong Kong actor recapped on his Instagram page to Bruno Mars’s “24K Magic,” might have gone largely unremarked if it wasn’t for the fact that it took place in Urumqi, the capital of the Xinjiang Uyghur Autonomous Region and ground zero for the U.S-Sino conflict over the brutal persecution of Muslim minorities that the Trump and Biden administrations have publicly called genocide.
While it’s unclear how many stores the California-based footwear purveyor operates in the controversy-riddled region—Skechers did not respond to multiple requests for comment—it’s at least its second. A video on Weibo, China’s version of X, shows a similar grand opening that took place at another Urumqi department store in June. Instead of Yen’s celebrity power, however, the occasion was feted by a person dressed in a giant panda suit and a Skechers T-shirt. There was also cake—the sheet kind, bordered by blue and white flowers. Voice of America first reported the existence of the stores earlier this month.
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As the world economy’s largest growth engine, China remains a vital market for most fashion brands and retailers, including those subject to the Uyghur Forced Labor Protection Act, or UFLPA, which imposes a rebuttable presumption that all goods originating in whole or in part from Xinjiang are the product of forced labor and therefore barred from entering the United States. According to local media, Skechers plans to double its store count in China to 6,000 by 2026. This despite the fact that its chief financial officer told an industry conference last month that China sales will be under pressure for the rest of the year because the market is “still re-forming itself post-Covid.”
But Skechers breaking new ground in Xinjiang is eyebrow-raising because it’s been accused on multiple occasions of benefiting from Uyghur forced labor through one of its Guangdong suppliers, Dongguan Oasis Shoes Co., which is also known as Dongguan Luzhou Shoes Co. and Dongguan Lvzhou Shoes Co. While Skechers previously admitted that Uyghurs make up part of the factory’s workforce, it said they’re employed under the “same terms and conditions” as their Han Chinese counterparts and can leave whenever they want. The U.S. Department of Homeland Security, however, has been unconvinced on either front. In June, it added Dongguan Oasis Shoes Co. to the UFLPA Entity List for what it said was cooperating with the paramilitary Xinjiang Production and Construction Corps to recruit, transfer and hire Uyghurs from Xinjiang.
“It was particularly problematic for Skechers to open a new store given that they have been previously linked to Uyghur forced labor,” said Jewher Ilham, forced labor coordinator at the Worker Rights Consortium, a Washington, D.C.-based nonprofit. She’s also the daughter of Uyghur scholar and economics professor Ilham Tohti, who has, for the past decade, been locked up behind bars in Urumqi on separatism charges and prevented from communicating with his family.
“And at this juncture, many international brands are being extra cautious when it comes to doing business in the Uyghur region given the mass human rights violations and state-imposed forced labor schemes that have been taking place there,” Ilham said. “It is very tone-deaf of them and sets a very bad example to other international brands.”
But Skechers isn’t the only business with a retail presence in Xinjiang. H&M Group, which faced a damaging Chinese consumer boycott in 2021 for vocally shunning Xinjiang cotton, boasts five stores, though a spokesperson declined to comment on whether they’ll remain open. Muji has five, which it says it will continue to operate. Hugo Boss, which until recently was embroiled in a Uyghur forced labor probe by the Canadian Ombudsperson for Responsible Enterprise, confirmed it has a store in Urumqi, though it didn’t respond when asked if there were plans to close it. Adidas, Armani, Ferragamo, Gucci, Nike, Vans and Versace, too, appear to have hung out shingles from Akesu to Urumqi. Like Skechers, they did not respond to repeated emails.
If the issue of companies eschewing Xinjiang materials on the one hand but remaining in Xinjiang itself has gone under the radar, it’s because the confluence of Chinese propaganda, Western economic interests and limited public awareness has made it this way, said Elfidar Iltebir, president of the Uyghur-American Association. Brands are more than aware of the risk of offending China, whose scale and economic significance present an intractable problem. Three years later, H&M, Adidas and Nike are still smarting from the bottom-line beating the social-media-led backlash generated. And just last month, Beijing opened an unprecedented investigation into whether Calvin Klein owner PVH Corp. took “discriminatory measures” by “unjustly boycotting” Xinjiang cotton.
At the same time, any brand doing business in China must work closely with the government, which means supporting, however indirectly, a genocide that has forcibly transferred more than 1.6 million Uyghurs to inner Chinese factories for cheap and menial labor, ltebir said. She said that the scheme separates families, preventing parents from passing down their values, culture and traditions to children who are taken to state-run orphanages and schools to be “re-engineered” as loyal Communist Party members.
“The forced labor of Uyghurs is part of a broader system of repression that includes mass internment, forced sterilizations, and the cultural erasure of Uyghur identity,” Iltebir said. “Brands that continue to operate in Xinjiang may be complicit, whether knowingly or unknowingly, in benefiting from forced labor, which is a severe violation of human rights. Their presence in the region allows China to perpetuate its genocide while …trying to portray to the world that there is no genocide and everything is business as usual.”
Adrian Zenz, a senior fellow in China studies at the Victims of Communism Memorial Foundation, agreed that no brand can operate a store in Xinjiang while professing to follow ethical business principles. While Beijing itself has denied claims of a crackdown, the mounting volume of evidence–both leaked and uncovered—is damning enough. There doesn’t seem to be any sign of an off-ramp, either: In August, the United Nations human rights office warned that “many problematic laws and policies remain in place” despite its warnings two years ago that the mistreatment of Uyghurs, including “credible” reports of arbitrary detention, forced sterilization, sexual violence, torture and restriction of individual and collective rights, could constitute international crimes.
“They should pull out, not because it is illegal, but to send a message that they will not make a profit in a region with an ongoing atrocity,” he said. “This is all the more important given the prevalence of forced labor in the region.”
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