WASHINGTON – A new US law targeting forced laborers in China’s Xinjiang region is having a major impact on trade flows between China and the US. For example, Chinese solar panels and other equipment to generate solar energy have piled up at the U.S. border since the law was passed. The report comes from analysts at investment bank Roth Capital.
In June, the Uyghur Forced Labor Prevention Act went into effect in the United States. The law prohibits US companies from financing forced labor in China’s Xinjiang region. Human rights groups estimate that at least one million Uyghurs and other Muslim minorities are held in “re-education camps” in Xinjiang. Beijing has vehemently denied the allegations. China insists the camps are vocational training centers.
According to Roth Capital, since the law was passed, solar panels and solar equipment totaling more than 3 gigawatts have been held by US customs. This could go up to 9 to 12 GW by the end of the year. Also, many Chinese manufacturers have reportedly stopped exporting solar panels and solar equipment to the US.
Keeping solar panels in place will make it harder for the U.S. to expand renewable energy capacity after the historic climate bill passed last week. The country is the world’s second-largest market for solar energy, but relies heavily on imports. China, by far the largest solar market, dominates the global supply chain, with Xinjiang a key manufacturing region.
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