US’ so-called Uyghur bill won’t affect region’s economy: experts

By Song Lin and Li Xuanmin Source:Global Times Published: 2019/12/4 19:48:40

Legislation more a case of creating new leverage in trade talks with China


A worker manufactures socks at a textile company in Aksu, Northwest China's Xinjiang Uyghur Autonomous Region, in November. Photo: Li Xuanmin/GT


The US House of Representatives on Tuesday (US time) approved the so-called Uyghur Human Rights Policy Act of 2019, which has been slammed by Chinese authorities and experts as interference in the internal affairs of China.

Even though it contains items aiming at restricting economic and trade activities between Northwest China's Xinjiang Uyghur Autonomous Region with companies from the US and even other countries, the bill won't have much impact on trade or the economy of Xinjiang, experts said.

"The bill also establishes that it is US policy to work with other countries to prevent them from exporting these technologies to China," read a statement on the Congressional website of Brad Sherman, a member of the US House of Representatives.

Liu Xiaoxue, an associate research fellow at the Chinese Academy of Social Sciences' National Institute of International Strategy, said that the bill won't have much impact on the economy of Xinjiang in light of the region's economic structure, as trade does not account for much of its GDP.

The US bill won't have much impact on Xinjiang's trade partners. Central Asian countries along the routes of the Belt and Road Initiative and Russia are its main trade partners.

According to data from website of the regional government, Xinjiang's GDP was 1.22 trillion yuan ($172.5 billion) in 2018, up 6.1 percent year-on-year. Its total trade was $20 billion, about 11.6 percent of GDP. Xinjiang's exports were $16.4 billion in 2018 while its imports were only $3.6 billion.

Tian Yun, vice director of the Beijing Economic Operation Association, noted that the bill was more like creating a new form of leverage in the US trade talks with China. It is no longer about so-called human rights issues, but the underlying interests the US wants to exchange with China, Tian said.

Given that the economic growth outlook for the US in the fourth quarter is not desirable, US President Donald Trump is actually facing mounting domestic pressure, Tian said.

US-based CNN reported on November 15 that "the US economy may not grow at all in the fourth quarter", citing data from professional GDP watchers.

Trump is also facing escalating pressure from sectors that have  suffered from the the trade war, including his "great farmers". On Wednesday, American Farm Bureau Federation President Zippy Duvall said in a statement that "we understand that tough talk is part of trade negotiations… but a trade agreement with a market as important as China's must be a priority."

As for Xinjiang, there's no denying that the US bill may affect confidence. Some companies have even started to expand their markets to avoid losses.

Li Judong, general manager of a fruit juice factory based in southern Xinjiang's Aksu Prefecture, told the Global Times that the company suspended exports to the US this year due to the US claims of human rights issues.

"We gave up the US market over uncertainties hanging over the bill. But this is not a big deal. Our main focus is shifting to Russia and Central Asian countries that border on Xinjiang. Our apple juice sells quite well there due to lower shipping costs," Li said. 

The company plans to export $14 million worth of fruit juice to Russia this year.

Last year, its main export destinations were the US, Australia and Japan, with exports totaling $11 million.

But some exporters also showed concern that the US may pressure its allies in Europe to order their companies to halt trade with clients in Xinjiang, which may weigh on business prospects. 

"We signed deals with a German clothing company as part of our efforts to diversify exports. Given the US' clout in the Western world, we are worried whether that company will be able to honor the deal," a manager of a local textile manufacturer in Xinjiang told the Global Times.



Posted in: ECONOMY,COMPANIES,BIZ FOCUS

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