Clothing retailers Nike Inc (NYSE:NKE) and H&M are facing a possible boycott in China over statements made by the two firms regarding the possible use of cotton picked using forced labour in the country’s Xinjiang province in their products.
The two firms had originally made statements last year saying they were concerned about reports that members of the Uyghur population in Xinjiang, against whom Beijing is accused of committing serious human rights violations including the use of concentration camps, had been used to pick cotton in the province. However, both companies said they did not source products from the region.
While the statements were made in 2020, they resurfaced recently on Chinese social media following the imposition of sanctions by several Western countries against Chinese officials believed to be connected to the abuse of Uyghurs.
The furore was quickly latched onto by China’s state media outlets, who have since launched propaganda campaigns defending Xinjiang cotton, accompanied by the usual rhetoric saying the companies would “pay a heavy price” for their actions.
Overnight on Wednesday, the backlash had shown signs of taking effect, with H&M products having been withdrawn from multiple Chinese ecommerce platforms including Tmall, JD.com and Pinduoduo.
The incident could cause a large headache for Nike and H&M, who like many firms have a large presence in China and are aiming to continue taking advantage of its large and growing consumer market.
However, the treatment of the Uyghurs, as well as criticism of the Chinese government’s handling of the initial coronavirus (COVID-19) outbreak in Wuhan in 2019, have threatened to upset the business interests of multiple western companies with large Chinese operations.