Human rights activists campaigning for multinational companies to be pressed into carrying out proper due diligence on their supply chains seemingly just gained an unlikely ally: The Trump administration.
On paper at least, US president Donald Trump’s officials have suddenly taken a keen interest in the cause of exploited workers toiling in sweatshops and mines.
That would mark a surprising humanitarian pivot for a US president who has done his best to defang the international rules-based order.
In reality, the president’s trade hawks are using a US law concerning forced labour from the 1930s as a creative way to prop up a new regime of trade tariffs on more than 80 countries.
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Trump trade envoy Jamieson Greer announced proposed tariffs of 10 per cent on imports coming from the European Union, Canada, the United Kingdom and Mexico and a slightly higher 12.5 per cent rate on China, Japan, India, South Korea, Brazil and scores of other countries.
The administration is pinning the justification for these new duties on the 1930 Tariff Act, which bans the import of goods produced by “forced or indentured” labour.
The White House will argue it has grounds to hike up tariffs on countries that don’t enforce a similar ban.
Washington has been scrambling for a new legal basis for Trump’s tariff agenda since a supreme court ruling in February said he could not rely on emergency powers to impose his “Liberation Day” levies on trading partners.
The investigation by Greer’s officials doesn’t claim to have evidence of products being made by exploited workers in each of the countries it slates for tariffs, only that those governments haven’t explicitly banned imports of such goods, or haven’t enforced a ban if it is on the books.
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The Trump administration claims that US companies are unfairly disadvantaged by the current situation and tariffs are needed to rectify the supposed imbalance.
A 98-page report from the US trade representative’s office talks solemnly about the prevalence of forced labour in the global supply chain, referencing documented abuses in the mass production of clothes and other garments, palm oil products, cotton, and cobalt and other raw materials mined by exploited workers.
The European Commission, which leads Europe’s tariff negotiations with the US, tries to avoid commenting on every twist and turn in the messy transatlantic tariff saga.
This one drew a response, though. A spokesman for the EU’s executive arm said using concerns about forced labour to levy tariffs was “unjustified”.
Two years ago, the EU actually passed a law banning products made with forced labour from the union’s market. It is due to come into force in December 2027.
The US report said as those EU-wide regulations had yet to take effect, European countries were deemed to be “failing to effectively enforce” the labour ban.
In the case of Canada, the trade representative’s report said that while the country had a ban in place, the number of enforcement actions launched was “minimal”, so it was in the frame for US tariffs as well.
During EU-US trade negotiations last year, Washington exerted pressure on Brussels to pare back or scrap new regulations that would require big companies to regularly check their supply chains for forced labour and child labour, as well as report on the environmental impact of their business.
The White House wasn’t happy about the extra red tape that would place on US multinationals. European industry pushed back on the rules too, and in the end, they were watered down.
Separate tariffs allowing the US to charge a 50 per cent tax on imports of steel and aluminium are based on grounds of national economic security, a tried and tested legal footing.
However, that route first requires a time-consuming investigation to lay out why a certain domestic industry needs to be shielded by protectionist trade measures.
Trump views tariffs as a powerful lever to strong-arm other governments into doing what he wants. It’s a lever he likes to be able to crank up and down at will.
It shouldn’t be a surprise that his administration is willing to reach for whatever increasingly flimsy basis they can find to allow him to continue to do that.
