NKE Nike Inc

By Eva Xiao 

HONG KONG -- The world's largest clothing brand, Hennes & Mauritz AB's H&M, is under assault in China, one of its biggest markets, over its stance on forced labor in the country's remote cotton-producing region of Xinjiang.

Chinese state media and social-media users excoriated the Swedish fast-fashion giant in an explosion of anger on Wednesday, accusing the company of spreading rumors and smearing China over a statement it made last year on forced labor in China's northwest Xinjiang region.

Searches for the H&M's name on China's biggest e-commerce platforms were blocked on Wednesday, while internet users took to China's Twitter-like Weibo to call for boycotting the company, which operates more than 400 stores in China. Two of the fashion company's Chinese brand ambassadors also announced they were cutting ties with H&M over what was called its smearing of China.

Alibaba Group Holding Ltd., Pinduoduo Inc., and JD.com Inc., which run the e-commerce sites blocking H&M, didn't immediately respond to a request for comment.

"Spreading rumors to boycott Xinjiang cotton while trying to make money in China? Wishful thinking!" wrote China's Communist Youth League in a post on Weibo that was forwarded nearly 30,000 times and attracted around 10,000 comments.

Western companies "should not be involved in this ideological conflict between China and the West under any circumstances," Hu Xijin, editor-in-chief of nationalist tabloid the Global Times, wrote in his own post on the platform.

The outrage appears to be in response to a statement the company issued last year expressing concern about reports of forced labor and discrimination against ethnic minorities in Xinjiang. H&M said in the statement that it didn't source products from the region and that it strictly prohibits forced labor in its supply chain, regardless of country.

On Wednesday, in response to the backlash, the company said it followed international guidelines for sustainability and that its supply chain principles "did not represent any political position."

"We are committed to long-term investment and development in China," the company posted on its official Weibo account, adding that it cooperated with more than 350 manufacturers in China.

H&M reported sales of more than $1.1 billion in China in 2020 despite a drop in store traffic because of the coronavirus pandemic. That places the country among its four largest markets, according to the company.

It couldn't be determined why the company faced the sudden onslaught over comments it had made in the past.

The backlash against H&M nevertheless highlights how multinational companies are being squeezed in an intensifying, high-stakes clash between Beijing and Western governments over human rights.

Earlier this week, China announced sanctions on more than a dozen individuals and entities in the European Union after the European bloc slapped sanctions on four Chinese officials for human-rights abuses in Xinjiang, where Beijing has carried out a repressive campaign against the region's mostly Muslim ethnic minorities that includes internment, extrajudicial detention, and forced labor.

Beijing has denied all allegations of human-rights violations in Xinjiang, instead describing the vast network of internment camps as vocational training centers aimed at countering terrorism and religious extremism.

In recent months, Chinese officials have become more aggressive in pushing back against criticism of Beijing's policies in Xinjiang, including using social media to personally attack foreign scholars studying the region.

That is forcing Western brands like H&M with lucrative businesses in China to pick a side. In January, U.S. Customs and Border Protection issued a ban on all cotton and tomato products from Xinjiang, placing the burden of proving the absence of forced labor on importers.

H&M was among several Western companies identified in a 2019 Wall Street Journal investigation of businesses that had grown entangled in China's campaign to forcibly assimilate Xinjiang's Turkic minorities.

In addition to H&M, Chinese online users took aim at other international apparel brands that were members of the Better Cotton Initiative, a nonprofit organization that certifies farms according to its cotton sustainability standards.

Last year, the U.S. Commerce Department blacklisted a Xinjiang subsidiary of one of BCI's members, Chinese yarn producer Huafu Fashion Co. Ltd., for being complicit in the region's human-rights violations. In October, BCI announced that it was suspending licensing of farms in the northwest region.

The organization's membership includes Nike, Adidas, and IKEA, all of which were targeted over their affiliation with BCI on Chinese social media on Wednesday.

Better Cotton Initiative didn't immediately respond to requests for comment.

On Chinese social media, users also called for kicking H&M out of China entirely, and various hashtags associated with the company were trending in the top-10 list, garnering a hundred million views within four hours.

"A low-end overseas brand runs to China to make a lot of money," wrote a user. "Hurry up and expel it from China! Get out, H&M!"

Chinese actor Huang Xuan's decision to sever ties with H&M topped the list, with almost 500 million views and received more than 140,000 likes within less than five hours. In a post on Weibo, the Chinese actor's studio said it was "resolutely opposed" to any attempts to discredit China.

--Sha Hua and Keith Zhai contributed to this article.

Write to Eva Xiao at eva.xiao@wsj.com

(END) Dow Jones Newswires

March 24, 2021 12:00 ET (16:00 GMT)

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