Advertisement

Oil

Norway's oil fund divests Chinese clothing brand over Uighur labour

AFP
AFP - [email protected] • 8 Mar, 2022 Updated Tue 8 Mar 2022 16:19 CEST
image alt text
People walk past a Li-Ning store in Beijing on October 2019. File photo: WANG Zhao / AFP

Norway's sovereign wealth fund, the largest in the world, will sell off its stake in China's Li Ning over suspicions of forced labour use in the Xinjiang region, the fund's manager said.

Advertisement

Li Ning, a manufacturer and trader of sportswear and equipment, was singled out "due to unacceptable risk that the company contributes to serious human rights violations," Norges Bank, the Norwegian central bank, said in a statement late on Monday.

The decision followed a recommendation from its Council on Ethics, which in an advisory opinion pointed to reports linking Li Ning to "a supplier said to manufacture inside an internment camp".

China is accused of having interned more than a million Uighurs, a Muslim minority living in Xinjiang, in political re-education camps and exploiting them for forced labour.

At the end of 2021, the Norwegian fund, which was then worth 12,340 billionNorwegian kroner (1,264 billion euros), held 0.59 percent of Li Ning shares, valued at nearly 1.5 billion kroner, which it has now sold.

Advertisement

In contrast, it has removed South Korean textile group Hansae Yes24 and Taiwanese Nien Hsing Textile from its watch list -- the step before companies are excluded - because it believed there was no longer reason to suspect systematic labour rights violations in their factories.

Meanwhile, it placed Canadian aircraft manufacturer Bombardier "under observation" over allegations of corruption in six countries over a period of more than ten years (2004-2016).

When it finalised the sale of its transport division to France's Alstom in early 2021, Bombardier had issued a 250 million euro bank guarantee to the French company to cover expenses related to these cases, the ethics board noted.

Also placed under observation was India's Adani Ports, because of its business dealings with the junta in Myanmar, and South Korea's Hyundai Glovis, because of its activities involving the beaching of boats in Pakistan and Bangladesh where they are broken up for scrap.

Finally, the fund also removed San Leon Energy from its blacklist, as the Irish oil company had ended its incriminating activities in Western Sahara.

As one of the world's largest investors, the Norwegian wealth fund -- known as the oil fund -- is governed by ethical rules that prohibit it from investing in companies involved in serious human rights violations, those that manufacture "particularly inhumane" or nuclear weapons, as well as coal and tobacco products.

READ ALSO: Norway’s oil fund says its Russia assets are down 90 percent

More

Comments

AFP 2022/03/08 16:19

Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.

Please log in to leave a comment.

See Also