Biden’s Uyghur labor law may affect Korean importers

Korean companies importing Chinese mineral resources including lithium and cobalt may be put on the sanction list of the Uyghurs Forced Labor Prevention Law, which takes effect on June 21 under the Biden administration. Under this law, importers of the products and raw materials produced in Xinjiang Uyghur must prove they are not relevant to forced labor.

“Thousands of global companies may actually have some link to Xinjiang in their supply chains,” The New York Times suggested on Monday, adding the imports of various products including EVs, battery, and renewable energies might be prohibited once the law takes effect. The NYT said the minerals in Xinjiang have been exported to the United States, Germany, the U.K., Japan and South Korea.

The KIEP pointed out that Korean companies might face the trouble of getting subjected to the trade sanctions under the law. As of 2020, Korean companies relied on Chinese imports for 80% of their lithium and cobalt needs used to manufacture trains and batteries.

China is the biggest producer of lithium in the world. The NYT reported that a big chunk of its lithium supplies is being mined or produced in the mines of Xinjiang Uyghur. Many experts are concerned that a contraction of lithium and other crucial mineral resources might fuel inflation further.


weappon@donga.com