China Warns Walmart, Sam’s Club Against Xinjiang Products

China’s anti-corruption agency on Friday accused US retail giant Walmart and its Sam’s Club chain of “stupidity and myopia” after Chinese media reported that the Sam’s Club had pulled Xinjiang products from stores.

Last week, the Sam’s Club came under fire in China after several news outlets shared videos and screenshots on the Weibo social media platform that they said showed products from the Chinese region. Xinjiang, in China’s far west, had been deleted from the store’s online app.

The social media feud erupted after US President Joe Biden enacted a law on Dec. 23 banning imports from Xinjiang over concerns about forced labor in that country.

Walmart is the latest foreign company to be triggered by Western pressure over Beijing’s treatment of Uyghurs and other Muslim minorities in Xinjiang and China’s importance as a market and supply base.

China rejects accusations of forced labor or any other abuse in Xinjiang.

Neither Walmart nor Sam’s Club have made public statements about the backlash against them in China, and Walmart did not respond to a request for comment on Friday.

The ruling Communist Party’s Central Commission for Discipline Inspection (CCDI) accused the Sam’s Club of boycotting products from Xinjiang and trying to “muddle” the controversy by remaining silent.

“Removing all products from a region for no good reason hides ulterior motives, reveals stupidity and myopia, and will surely have its own negative consequences,” he said on his website.

China is a huge market for Walmart, which generated sales of $ 11.43 billion in the country in its fiscal year ended Jan.31. Out of 423 retail units Walmart operates in China, 36 are Sam’s Club stores, according to its website.

A search for popular Xinjiang products like raisins on the Sam’s Club China store app did not yield any relevant results, but neither did searches for products from other places, such as Fujian tea, according to the report. a Reuters review on Wednesday.

Chinese media have quoted customer service representatives from Sam’s Club as explaining that the products have not been withdrawn but rather out of stock.

CCDI on Friday called it a “misleading excuse” and said the channel would have to respect China’s stance on Xinjiang if it was to “stand firm in the Chinese market.”

It’s not uncommon for a foreign brand to be the target of Chinese social media users or official outlets, and the impact can be damaging.

Earlier this week, the Weibo hashtag “Sam’s Club Card Cancellation” went viral, with more than 470 million visits. The state-owned China Daily newspaper on Friday reported that domestic rivals had organized campaigns to promote products from Xinjiang.

In July, Swedish fashion retailer H&M reported a 23% drop in local currency sales in China for its March-May quarter after being hit by a consumer boycott in March for publicly declaring it would not did not source products from Xinjiang.

This month, U.S. chipmaker Intel faced similar calls after telling its suppliers not to source products or labor from Xinjiang, prompting it to s ‘Apologize for “the trouble caused to our respected Chinese customers, partners and the public.”

On Friday, CCDI accused H&M, Intel and the Sam’s Club of collaborating with “anti-Chinese Western forces” to destabilize Xinjiang by cracking down on and boycotting products from the region.

“These Western companies, which once boasted of being immune from political interference, have slapped themselves in the face with their own actions.”