Intel Deletes Xinjiang Forced Labor Reference After China Backlash
American chip manufacturer Intel has quietly removed a request for suppliers to avoid parts sourced by forced labor from Xinjiang, following a Chinese social media furore and state media threats to boycott its products.
The company reminded suppliers in a memo last month that "multiple governments" had imposed restrictions on products from the region, where the United States has determined human rights abuses amounting to "genocide" are ongoing against Uyghur Muslims and other ethnic minorities.
Last month, President Joe Biden signed into law the Uyghur Forced Labor Prevention Act, which bans goods from the region unless importers can prove they were not sourced through forced labor.
Intel's notification to suppliers was reported by news sites in China, where social media users erupted in anger at the reference.
Guancha, a nationalistic news outlet, reported on Intel's letter and referenced the Chinese market's importance to the company, alluding to potential room for economic leverage and punishment. Social media users then urged a boycott of technology products containing Intel chips.
Intel then issued an apology, explaining that the note was to ensure "compliance with U.S. laws" rather than an expression of the company's position regarding Xinjiang.
"We apologize for the trouble caused to our respected Chinese customers, partners and the public. Intel is committed to becoming a trusted technology partner to accelerate joint development with China," it said.
A Wall Street Journal report on Monday noted that Intel that erased specific reference to Xinjiang in a revised version of its December letter.
The relevant section now read: "Prohibiting any human trafficked or involuntary labor such as forced, debt bonded, prison, indentured or slave labor throughout your extended supply chains."
China accounts for 25 percent of Intel's annual revenue.
During an online event hosted by the Atlantic Council think tank's GeoTech Center, Intel CEO Patrick Gelsinger explained the change, which he described as appropriate.
"We found that there was no reason for us to call out one region in particular anywhere in the world because there's many regions in the world that are having issues of such a matter," he said.
"So we simply revised the policy. The policy hasn't changed. We did revise it to not include any one particular region in the world," he said, noting that Intel had never sourced parts from Xinjiang.
Gelsinger was among other corporate leaders who lobbied Congress for the CHIPS Act, which will better fund American chipmakers in order to increase the competitiveness of the semiconductor industry in the U.S.
During the Atlantic Council event, he said it was important for companies such as the world-leading Taiwan Semiconductor Manufacturing Company to diversify its fabrication away from Asia, a region Gelsinger said was "geopolitically less stable."
He also expressed concerns that China could one day take over Taiwan's critical semiconductor plants in the event of an attack.
Senator Marco Rubio, who authored the Uyghur bill, released a statement through his office on Monday in which he was critical of Intel's apology as well as its decision to remove references to Xinjiang, despite its compliance with the forced labor law.
"Intel's cowardice is yet another predictable consequence of economic reliance on China," the Republican from Florida said. "Instead of humiliating apologies and self-censorship, companies should move their supply chains to countries that do not use slave labor or commit genocide."
He added: "If companies like Intel continue to obscure the facts about U.S. law just to appease the Chinese Communist Party then they should be ineligible for any funding under the CHIPS Act."
