US puts Japan Inc. on edge over Xinjiang supply chain risks

Scrutiny grows over indirect suppliers in solar panel materials and apparel

Renewable energy materials, like polysilicon used in solar panels, join the list of industries where forced labor in China's Xinjiang region has been reported, the U.S. State Department alleges.

TAMAKI KYOZUKA and TAISEI HOYAMA, Nikkei staff writers

July 15, 2021 05:43 JST

TOKYO/WASHINGTON -- From solar panel producers to apparel retail giant Uniqlo, Japanese businesses increasingly fear a backlash over potential human rights violations at their indirect partners as the U.S. renews its warning against companies linked to forced-labor allegations in China's Xinjiang region.

American businesses that fail to exit supply chains, ventures and investment in Xinjiang "run a high risk of violating U.S. law," the State Department and five other agencies warned in an updated advisory Tuesday, hinting that even indirect links to rights violations against the Uyghur ethnic minority in the region could bring penalties.