German carmaker Volkswagen said on Wednesday it was discussing the future of its activities in China’s troubled Xinjiang region after new allegations of human rights abuses emerged.

The Business Daily Financial Daily reported that forced labor may have been used in the construction of a test track in Turpan, Xinjiang in 2019. Volkswagen said it had found no evidence of human rights abuses related to the project but vowed to investigate any new information it received. Light.

Volkswagen added that it was in talks with its Chinese joint venture partner SAIC Motor over the “future direction of business activities in Xinjiang,” in a clear sign of growing pressure on the group’s operations in the region. “The various scenarios are currently being studied in depth,” Volkswagen said in a statement.

After German chemicals giant BASF announced last week that it would accelerate its exit from two joint ventures in Xinjiang, there are growing calls for Volkswagen to reconsider its business activities in the region. For years, human rights activists have accused Beijing of brutal repression against Uighurs and other Muslim minorities in Xinjiang, including through forced labor and internment camps.

Beijing denies accusations of abuse and insists its actions in Xinjiang help combat extremism and promote development. Xinjiang is home to numerous factories that supply multinational companies, including well-known Western brands. Volkswagen has long been closely watched for its plant in Urumqi, Xinjiang, which opened in 2013 and in which it holds a stake through joint venture partner SAIC Motor.

An external audit commissioned by Volkswagen last year found no evidence of forced labor among the plant’s 197 employees. But the consulting firm that wrote the report acknowledged “the challenges of collecting data” for conducting audits in China. The Turpan test track was not included in the audit.

– “No Zone” –

Politicians from Chancellor Olaf Scholz’s tripartite alliance of the Social Democratic Party (SPD), the Green Party and the pro-business Free Democratic Party have called on Volkswagen to withdraw from China in recent days. Renata Alt, chairman of the German parliament’s human rights committee and a member of the Free Democratic Party, told Der Spiegel that Xinjiang “must become a no-go zone for the economic activities of Western companies, including Volkswagen.”

“The human rights situation in Xinjiang is so disastrous and opaque that German companies should not be operating there,” added SPD MP Frank Schwabe. Germany’s BASF was the first to announce on Friday that it would speed up the sale of its shares in two companies in Xinjiang, citing environmental and commercial reasons. But the move comes after German television channel 2 and news outlet Der Spiegel said employees of Chinese joint venture partner Markor were involved in violations of Uyghur rights.

Markor employees reportedly visited Uyghur families to conduct surveillance. The German company said regular audits found no evidence of rights violations at the two joint ventures, but media reports “contained serious allegations that their activities were inconsistent with BASF’s values”. BASF gave no timetable for the divestment but stressed its ongoing commitment to China, including the construction of a new €10 billion chemicals complex in the southern province of Guangdong.

Katja Drinhausen, an analyst at the Mercator Center for China Studies in Berlin, said the careful wording showed that “global companies like BASF or Volkswagen face not only legal and contractual obligations as they weigh their response to the Xinjiang dispute, but It also faces political risks.” All of these considerations make “a quick exit unlikely,” she added.

(This story has not been edited by News18 staff and is published from associated news agency – AFP)