China’s Ratification of Two ILO Conventions Could Improve the Transparency of its Supply Chain

China ratified two International Labour Organization (ILO) conventions on forced labor amid global criticism of the country's treatment of the Uyghur minority in Xinjiang. By ratifying the conventions, China agreed to abolish any forms of forced or compulsory labor, including those for political coercion and religious discrimination. The significant move will oblige the country to implement the conventions into national laws and expose it to supervisory mechanisms and interventions for failures in implementation.  

China has been under enormous political and economic pressures due to the lack of transparency regarding its labor practices in Xinjiang. Europe paused a bilateral investment agreement due to human rights concerns and the United States has passed the Uyghur Forced Labor Prevention Act, which bans imports of goods from Xinjiang starting in June. 

The Chinese government is hoping to leverage the conventions to revive the European deal and regain its central position in the global supply chain. However, it could take years for actual changes to take place. Generally, conventions go into effect within a year after the date of ratification, with ratifying countries enacting their provisions as national law and providing updates on application at regular intervals. China, however, may not have the ecosystems to engage in this process as quickly.  “Effective protection of labor rights requires a supportive ecosystem with multiple elements, but most of these are missing within the current Chinese politico-legal system. The lack of independent trade unions and free media are a case in point,” said Surya Deva, professor of law at Macquarie University in Australia.  

Nevertheless, ratification alone sent a positive signal about China’s willingness to work on its forced labor issues. It will enable the international community and trade unions to demand compliance with international standards ratified by the Chinese government. In addition, representation and complaint procedures can be initiated for violations of the Conventions.  

Outlook: Even though the changes wouldn’t happen overnight, it is a great news for companies who have supply chain operations in China as the government is willing to adhere to international labor standards which potentially could resolve some compliance issues for global companies.