US legislators, fronted by Representative Blaine Luetkemeyer, are making strides to prohibit all goods imported via the Chinese-controlled shopping platform, Temu, stemming from concerns of forced labor.
They are petitioning the Biden administration to recognise Temu as a transgressor of the Uyghur Forced Labor Prevention Act, and push for an extensive investigation into the app’s potentially unlawful activities.
This act was initiated in 2021 to hinder goods produced through forced labor in China’s Xinjiang region from infiltrating American markets.
Its main purpose is to halt human rights abuses against China’s Uyghur Muslim minority group and enforce business transparency.
However, China’s government and the Temu app, a subsidiary of PDD Holdings in China, have rejected these human rights violation accusations.
Despite this, if Temu is recognised as guilty, it may lead to a comprehensive ban on all commodities traded through the platform.
With aggressive pricing strategies, Temu has established significant growth in the American market, spiralling into competition with established US retailers like Amazon and Walmart.
Other major competitors also include Shein, who are responsible for 20% of the worldwide fast-fashion industry according to Coresight Research.
The success of these foreign companies is being associated with forced labor and government subsidies, and thanks to current US trade law, packages deemed less than $800 are able to enter America tariff-free.
There is now a push for the reevaluation and potential amendment of these tariff rules in order to maintain a level playing field among retailers and protect local industries.
In bid to control the surge of cheap orders from China, legislative changes have been proposed by Senators Sherrod Brown and Rick Scott, who have appealed to President Biden to cease the tariff-free entry policy.
The senators postulate that foreign entities pose a threat to America’s economy and argue that the increase in imports shifts the balance of America’s manufacturing and retail industries in China’s favor.
Moreover, they believe that the exploitation of labor and other tactics are detrimental to America’s economy.
Their letter to President Biden suggests that unrestricted Chinese sellers threaten American businesses and the underlying principles of fair trade.
Brown and Scott have urged President Biden to swiftly address these issues and shift the balance to protect domestic industries and labor rights.
