The America First Policy Institute (AFPI) has released a report stating that leading fast fashion brands, Shein and Temu, are powered by "slave labor." The author of the report, Adam Savit, who is also the director of AFPI's China Policy Initiative, said that Uyghur Muslims and other ethnic minorities are subjected to forced labor in China's Xinjiang region, benefitting the Chinese Communist Party (CCP).

According to Savit, U.S. efforts to disengage from Xinjiang's cotton supply chains, such as the 2021 Uyghur Forced Labor Prevention Act, have "fallen short." He argues that the United States needs to bolster its enforcement mechanisms to disconnect from supply chains driven by "slave labor." Savit emphasized that addressing the de minimis loophole is crucial. Through this loophole, he says, "hundreds of millions of packages" enter the United States annually without being subjected to tariffs or customs inspections.

Savit explains that the multi-billion-dollar fast fashion industry is influenced by pop culture trends, resulting in "cheap, trendy clothing," designed to meet fluctuating demands. He states that leading fast fashion companies like Shein and Temu can offer their products at low prices because they source raw cotton in Xinjiang and benefit from volume discounts from manufacturers while relying on "highly efficient export supply chains."

The United Nations, the U.S. government, and American think tanks have accused the CCP of using Uyghur Muslims in "slave or forced labor," according to Savit. He cites media reports and CCP documents supporting these claims that Uyghur Muslim labor is used for sourcing raw cotton for clothing production. He further states that tens of billions of dollars' worth of goods from leading Chinese fast fashion companies are imported into the United States each year - a practice he describes as "effectively sponsoring the continued enslavement of a brutally repressed minority population at the mercy of the CCP."

The report reveals that Shein, with an estimated valuation exceeding $100 billion and a 50% market share of American fast fashion sales as of November 2022, is a significant player in the industry. It also states that Shein's app was the most downloaded fashion and beauty platform in the United States in 2022, with approximately 27 million downloads. Temu has been following Shein's lead, expanding rapidly in the United States over the past year and offering consumer goods and electronics alongside clothing.

According to Savit, increasing public awareness of forced labor in Xinjiang led to the passage of the Uyghur Forced Labor Prevention Act in 2021. However, enforcing this measure has proved challenging. The bill was designed to strengthen existing laws barring goods made with forced labor, specifically section 307 of the Tariff Act of 1930. Despite these efforts, Savit says that U.S. attempts have struggled due to factors such as insufficient funding, high volume imports, and lack of transparency and accountability from the CCP.

Savit suggests that if the United States could successfully enforce the Uyghur Forced Labor Prevention Act, products from Shein and other fast fashion companies using Xinjiang-sourced cotton would not enter the country. The legislation requires importers to prove that any goods produced wholly or partially in Xinjiang did not involve forced labor. However, according to Savit, both Shein and Temu have refused to comply with this legislation - either neglecting to impose required standards on themselves or taking actions that actively obscure independent verification.

Before joining AFPI, Savit served as China program coordinator at the Center for Security Policy and president of the Log Cabin Republicans of Washington, D.C., according to AFPI's website. In addition to these roles, he has held various national security research and communications positions. He is also a John Quincy Adams Fellow at the Common Sense Society.