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Lawmakers push for probe of German companies' role in Xinjiang

Nazi-era use of slave labor haunts Siemens, Volkswagen and BASF

Volkswagen has said it hopes its joint venture factory in Xinjiang can contribute to the region's development.    © Reuters

HAMBURG, Germany -- In the wake of a U.S. Congressional vote to target companies involved in repression in China's Xinjiang region, German legislators are pushing for their own inquiry into the activities there of multinationals such as Siemens.

The possible role of German companies in ethnic repression is a touchy topic in Berlin given the involvement of industrial groups such as Volkswagen and Siemens with slave labor during the Nazi era. Chemical producer BASF has admitted its then-parent company hosted a concentration camp on factory grounds.

Though lawmakers have not converged on a specific proposal yet, their calls for an investigation come amid a wider parliamentary revolt against a government proposal that could allow China's Huawei Technologies to supply equipment for 5G networks in the country. Discomfort with policies that have allowed Chinese companies to buy out leading high-tech companies like robotics maker Kuka have pushed the government to step up controls and defenses against takeovers by non-EU purchasers.

The calls for action on Xinjiang come amid growing international disquiet about China's intensive effort to eradicate separatist impulses in the region which has reportedly led to the detention of 1 million Muslims in internment camps and the alleged conscription of forced labor in factories and cotton fields.

Although German government officials have criticized human rights conditions in Xinjiang, Steffen Seibert, chief spokesman for Chancellor Angela Merkel, said Nov. 25 that operating in the region "is solely a decision of any given company" in the absence of official sanctions.

Dissatisfied with this passive approach, a number of opposition lawmakers are calling for an official inquiry.

"It is clear that Volkswagen and BASF are operating in a gruesome police state, thereby contributing to Chinese propaganda," Margarete Bause, caucus speaker on human rights policy for the Greens, told the Nikkei Asian Review.

"We want the foreign and economic ministries to convene an ad hoc conference with the involved companies to discuss the situation, identify possible breaches of the national action plan for the economy and human rights, and decide on follow up actions," said Bause, who has also called for Germany to end its small military training program for Chinese soldiers given human rights abuses in Xinjiang and elsewhere. Beijing barred her from joining a parliamentary delegation trip in August.

Johannes Vogel of the pro-business Free Democratic Party told Nikkei, "China has changed under (President) Xi Jinping and we have to scrutinize where the red lines are and what to put up with and what not."

"I have no reasons to doubt Volkswagen's statements (about Xinjiang), but factories should be closed down if there is evidence of direct or indirect profiting from forced labor," said Vogel, who serves as deputy head of the German-Chinese Parliamentary Group.

The bill passed this week by the U.S. House of Representatives, in a 407-1 vote, would require Washington to avoid giving contracts to companies involved with mass internment in Xinjiang and to restrict the export of technologies that might be used to facilitate detentions, among other measures. The bill awaits reconciliation with a milder version adopted earlier by the U.S. Senate.

Questions about Xinjiang involvement have particularly dogged electronics and engineering company Siemens because of its possible connection to advanced surveillance systems in the region that curtail movement and religious and cultural practices.

Siemens Chief Executive Joe Kaeser publicly urged the German government in September to be "respectful" in criticizing China, saying that jobs could be at stake. His company reached an agreement last year to cooperate on manufacturing technology development with China Electronics Technology Group.

The state-owned company created a police surveillance app used in Xinjiang and is the controlling shareholder of surveillance equipment maker Hikvision whose equipment is used by security networks across the region. Hikvision was blacklisted by the U.S. in October for its role in Xinjiang, which is nominally the autonomous homeland of the Muslim Uighur minority.

More than 1 million Muslims are believed to have been detained around Xinjiang in what China labels as vocational training centers.   © Reuters

"We see Siemens' ties with Chinese companies supplying policing technology as the (key) problem, with lots of questions still unanswered," Peter Irwin, a program manager with the Munich-based World Uyghur Congress, a leading diaspora organization, told Nikkei.

Siemens insists that its partnership with China Electronics concerns just technologies for advanced manufacturing systems and that it would never be involved with detention camps. "Siemens does not supply any products that are used in our customer's end product," the company has said.

BASF opened a chemical factory in Korla, Xinjiang's second-largest city, in 2016 through a joint venture with a local company. Volkswagen's tie-up with China's SAIC Motor has had a factory in Urumqi, the regional capital, since 2013 where 650 workers assemble cars. Chief Executive Herbert Diess was criticized earlier this year after he told a television interviewer he was "not aware" of reports about mass internment camps in Xinjiang.

Sportswear maker Adidas, which was founded after World War II, has sourced clothes from Chinese suppliers allegedly using cotton harvested using forced labor and in at least one case, using a Xinjiang factory that deployed involuntary workers.

A BASF spokesman said the company's joint venture does not used forced labor and the company is "aware of the social issues in the region."

A Volkswagen spokesman similarly told Nikkei: "Volkswagen is aware of the situation in the region. No employee works under duress."

Adidas has told its suppliers to halt outsourcing to the factory said to have used forced labor.

"In spring 2019, we explicitly required our suppliers not to source any yarn from the Xinjiang region," Adidas spokesman Stefan Pursche said. "Adidas has never manufactured goods in Xinjiang and has no contractual relationship with any Xinjiang supplier."

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