China’s labour practices came under scrutiny on Wednesday during a US government hearing on a proposal to impose tariffs on goods linked to forced labour, with participants divided over whether higher tariffs would effectively improve workers’ rights.
The Office of the United States Trade Representative (USTR) is holding a three-day public hearing from July 7 to 9 as part of its Section 301 investigation into the use of forced labour in international supply chains.
The investigation and the hearings are key steps to lead to tariffs ranging from 10 to 12.5 per cent on imports from 60 economies that Washington says have failed to prevent goods made with forced labour from entering global supply chains.
The forced-labour probe is one of several Section 301 investigations launched since the US Supreme Court curtailed President Donald Trump’s use of emergency tariff powers, highlighting how the administration is increasingly relying on Section 301 investigations as a legally durable path for new tariffs.
“China should have a higher rate [of tariffs],” said Qiang Li, founder of China Labor Watch. “If a country gets better, its rate should go down.”
Li, a long-time critic of China’s labour practices, testified that many Chinese workers face excessive overtime, inadequate workplace protections and limited access to insurance compared with workers in many Western countries.
During the question-and-answer session, Li spoke in Mandarin through an interpreter. He argued that China’s low manufacturing costs allow exporters to absorb tariffs of up to 12.5 per cent without significantly raising prices, so higher tariff rates would be needed to encourage better labour practices.
In June, US Trade Representative Jamieson Greer released a report identifying 60 economies covered by the investigation. The report highlights Chinese-linked supply chains, including cotton, polysilicon used in solar panels and critical minerals.
The Chinese embassy in Washington strongly denied the forced labour allegations in a statement, saying China opposes all forms of unilateral tariff measures and there are no winners in a tariff war or a trade war.
“Economic and trade issues should be worked out through dialogue and consultation on the basis of equality, respect and mutual benefit,” embassy spokesperson Liu Chang said.
Beijing has called the allegations politically motivated and launched its own investigation into US trade practices in response to recent US trade actions.
Not everyone at the hearing supported the proposed tariff approach. Business groups warned that broad tariffs could punish importers without addressing labour abuses at their source.
Jonathan Gold, vice-president for supply chain and customs policy at the National Retail Federation, argued that blanket tariffs are not an effective way to address forced labour concerns.
Gold, speaking on behalf of the Forced Labor Working Group, said the proposal is “legally unsupported, economically harmful and counterproductive” to the goals of the investigation.
In addition to the forced-labour probe, US officials have also opened a separate Section 301 investigation into what they describe as excess industrial capacity, arguing that Chinese manufacturers produce more goods than the market can absorb, depressing global prices. Beijing has rejected those allegations.
The hearing will continue on Thursday. No representatives of the Chinese government are scheduled to testify.
Officials and business representatives from Mexico, India, Brazil, Honduras and other economies covered by the investigation appeared before the panel, defending their labour practices and opposing both the forced labour allegations and the proposed tariff increases.
The USTR will continue accepting public comments for several days after the hearing concludes before deciding whether to proceed with the proposed tariffs. -- SOUTH CHINA MORNING POST
