Since late 2023, BASF announced its intention to divest its shares in BASF Markor Chemical Manufacturing and Markor Meiou Chemical in Xinjiang’s Korla region. German media had alleged its local partner was involved in human rights abuses in Xinjiang.

BASF said Tuesday in a statement that the buyer was Verde Chemical Singapore Pte. Ltd. which is majority controlled by Verde Ventures SGP, a Singapore-registered company. Both parties have agreed not to disclose financial details of the transaction completed Monday, it said.

BASF has previously said its audits had not found any evidence of human rights violations in the two joint ventures, but that published reports contained “serious allegations that indicate activities inconsistent with BASF’s values.”

The German newspaper Handelsblatt published a report in November 2023 alleging BASF-Markor’s shareholder, Zhongtai Group in Xinjiang and its subsidiary Zhongtai Chemical, were using Uyghur slave labor. The U.S. government, which has blocked imports from Xinjiang unless proven they were not made with forced labor, has included Zhongtai Group and Zhongtai Chemical on a sanctions list.

On Tuesday, Rushan Abbas, executive committee chair for the World Uyghur Congress, an advocacy group for the global Uyghur diaspora, described BASF’s withdrawal as “a significant step towards corporate accountability in the face of modern slavery.”

“We urge other multinational corporations to follow suit,” she said.

The U.S. government has determined that persecution of Uyghur Muslims in Xinjiang amounts to genocide. A law passed in 2021 makes it illegal to import products used Uyghur forced labor into the United States.

Last November, the other major German investor in Xinjiang, automaker Volkswagen, sold its operations there. Activists and experts had accused VW of allowing the use of Uyghur slave labor at the its joint-venture plant with Chinese state-owned company SAIC Motor Corp. in Urumqi, Xinjiang’s capital.

Edited by Mat Pennington

This content originally appeared on Radio Free Asia and was authored by RFA Uyghur.

In July, two separate People’s Defense Forces took control of the Alpha Cement factory in Mandalay region and the Tagaung Taung nickel mine in Sagaing region.

Junta troops attacked the cement factory, about 30 kilometers (19 miles) north of the junta’s Central Command, and tried to burn down buildings inside the compound while fleeing a successful assault by the Mandalay People’s Defense Force militia, Myanmar Now reported. 

The military has conducted daily airstrikes on the cement plant, owned by Myanmar’s Myint Investment Group and and China’s Anhui Conch Cement Co., since militia forces capturing it, the report said.

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A People’s Defense Force in northwestern Myanmar’s Sagaing region took over a major Chinese-backed nickel-production plant from junta forces in July without a fight on the border between Mandalay region’s Thabeikkyin township and Sagaing region’s Tigyaing township, Myanmar Now said in another report.

About 60 junta soldiers and police abandoned 64 weapons and ammunition at the Tagaung Taung mine compound and left, Nay Phone Latt, spokesman of the Prime Minister’s Office of the shadow National Unity Government, or NUG, told Radio Free Asia. 

The NUG is now responsible for the safety of the factory and its employees, he said.

The seizure of the cement factory and nickel mine comes as the junta continues to lose ground to People's Defense Forces, or PDFs, loyal to the NUG and allied ethnic armed groups — almost four years into a civil war that shows no sign of abating.

The incidents also indicate that the junta cannot fully safeguard Chinese-invested projects in Myanmar and that increased discussions between Beijing and the NUG may be forthcoming, said political analyst Than Soe Naing.

“China will need to decide whether to rely on the military council or the PDFs and ethnic armed forces to protect its interests in Myanmar,” he said. 

The NUG has not issued instructions for the two factories to cease operations, and they are able to continue normal operations, despite the fighting, said Nay Phone Latt.

The Chinese Embassy in Myanmar said it may investigate the situation of the factories seized by the PDFs, but it did not respond to RFA’s request for comment.

Chinese Foreign Ministry spokesperson Mao Ning told a regular press conference in Beijing on July 25 that conflicts in Myanmar should not interfere with domestic Chinese projects, businesses or the security of Chinese citizens.

The NUG will not recognize businesses established under contracts signed with the State Administration Council, the formal name of the ruling junta, but will accept those that operated under contracts signed by previous governments, Nay Phone Latt said.

International companies operating in Myanmar must pay taxes to the NUG instead of to the military council, he added.

The NUG said its policy is to protect all legal foreign investments in Myanmar, not just those from China.

Junta spokesman Maj. Gen. Zaw Min Tun and spokesmen for Mandalay and Sagaing regions did not respond to requests for comment.

Translated by Kalyar Lwin by RFA Burmese. Edited by Roseanne Gerin and Matt Reed.

This content originally appeared on Radio Free Asia and was authored by By RFA Burmese.

BASF announced last Friday that it would “accelerate the ongoing process” to divest its shares in two joint ventures – BASF Markor Chemical Manufacturing and Markor Meiou Chemical in Xinjiang’s Korla region – which began at the end of last year. German media had earlier alleged its local partner was involved in human rights abuses in Xinjiang.

BASF’s exit could trigger other Western companies to follow, including auto giant Volkswagen that has a plant in the capital city Urumqi, according to lawmakers and academics, who called the chemical company’s move belated and insincere.

A BASF statement said the decision was based on commercial considerations. However, it acknowledged that the local situation in Xinjiang is also part of BASF's overall assessment of the Korla joint ventures.

BASF denied published reports that employees of the joint ventures were involved in the Chinese communist authorities’ suppression of Uyghurs, and said the claims related to its joint venture partner Markor, in which it has no stake. 

“Regular due diligence measures including internal and external audits have not found any evidence of human rights violations in the two joint ventures. Nonetheless, recently published reports related to the joint venture partner contain serious allegations that indicate activities inconsistent with BASF’s values,” the statement said.

A spokesman said BASF could not predict when the sale would be completed, but it would not change the company's China strategy or other businesses in the country.

Money over morals

The German newspaper Handelsblatt published a report last November exposing BASF-Markor’s shareholder, Zhongtai Group in Xinjiang and its subsidiary Zhongtai Chemical, for allegedly using Uyghur slave labor. The United States government, which has blocked imports from Xinjiang unless proven they were not made with forced labor, has included Zhongtai Group and Zhongtai Chemical on a sanctions list since last summer.

Zhu Rui, a Chinese lecturer at a German university, believes that BASF’s belated decision was made under growing pressure from international public opinion as German companies who look to profit from Chinese investments are also governed by laws and human rights standards at home.

“The BASF incident is very much like a live version of Huntington's ‘Clash of Civilizations’,” Zhu said, referring to Samuel P. Huntington’s theory that the primary cause of conflict in the post-Cold War world will be cultural, rather than ideological or economic.

While the “Western civilized world” requires multinational companies to respect human rights values, BASF not only went to China, a country known for its poor human rights standards, but to Xinjiang, a Chinese region that operates concentration camps for Uyghur people, he added.

“This all reflects the dilemma it faces between adhering to Western values ​​and choosing the Chinese market,” Zhu told Radio Free Asia. 

“BASF's production capacity in China roughly accounts for half of its global output. In retreating from Xinjiang, BASF says it hopes to retain its operations in China. But, being between Western values and giving China face, it can’t please either side.”

Who’s next?

On Feb. 5, 30 members of the Inter-Parliamentary Alliance on China (IPAC) – an international cross-party group of legislators – wrote to BASF CEO Martin Brudermüller, expressing deep concern about the “shocking degree” to which BASF appeared to be implicated “in gross abuses of the Uyghur and other predominantly Turkic minorities,” in Xinjiang, and demanding that BASF withdraw from the region.

One of the signatories, the deputy chairman of Germany’s Free Democratic Party Gyde Jensen, told the Handelsblatt that BASF's decision to divest from the controversial Xinjiang joint venture factory was belated, and the reasons cited were insufficient. She also urged Volkswagen to seriously consider the reputational risks of continuing to build factories in Xinjiang.

German lawmaker Michael Brand agreed that BASF's move came too late, made as the company ran out of options. 

"If Mr. Brudermüller thinks he can now avoid joint responsibility for serious human rights violations while in China, he and BASF may be wrong, and the German law will not forget serious human rights violations," Brand said.

Ilshat Hesen Kokbore a US-based Uyghur scholar and vice chairman of the World Uyghur Congress, argued that BASF does not realize it has become an accomplice of the Chinese Communist Party’s genocide against the Uyghurs. 

“Regardless of whether you participated or not, you have factories there, and the companies you invest in are tools of the Chinese totalitarian government. You are an accomplice,” he said.

Others believe BASF's withdrawal from its Xinjiang joint ventures will double down the pressure on Volkswagen.

Adrian Zenz, a scholar on Xinjiang internment camps said the BASF divestment sends out an important signal – Volkswagen, the only German company with a factory there, has no more excuses not to exit from Xinjiang. 

An external audit commissioned  by Volkswagen last year carried out by Löning, a German consultancy accompanied by an unnamed Shenzhen-based law firm, found no indication of forced labor at the plant. But staff at the consulting firm and outside experts have expressed doubts about the credibility of the investigation.

Company representatives once said privately that considering the local situation in Xinjiang, no company would make this site selection decision again.

Translated and additional reporting by RFA staff. Edited by Mike Firn.

This content originally appeared on Radio Free Asia and was authored by By Yitong Wu and Chingman for RFA Cantonese.