© Reuters. File photo: On March 28, 2019, a Walmart logo was displayed in a Walmart store in Mexico City, Mexico.REUTERS/Edgard Garrido/File Photo
BEIJING (Reuters)-Walmart (NYSE:) Sam’s Club, a company’s Sam’s Club, responded to China’s outrage caused by local media claiming that it had deliberately removed Xinjiang products from its app, in a call with analysts This move was denied at the meeting and called it a “misunderstanding.”
Chinese social media users and local news media criticized Sam’s Club, a membership-based warehouse club that provides products and services, last week for removing products from its domestic online store. The Chinese anti-corruption agency accused the American retailer and Sam’s Club of being “stupid and short-sighted” in this matter.
Last week, a representative of Sam’s Club told local analysts on a conference call organized by a domestic securities company that Chinese consumers could not find products from Xinjiang because the app does not support searching for products based on place names.
The complete recording of the conference call was shared with Reuters by a participant, who introduced the representative as Zhang, the regional e-commerce leader of Sam’s Club.
“This matter was a misunderstanding,” Zhang said on the phone.
“We did not defend ourselves because there is no reason to be afraid of what we have not done,” Zhang added. The second participant confirmed Zhang’s comments on the phone, which also talked about Sam’s Club’s plans in China.
Wal-Mart did not respond to a request for comment. So far, neither Wal-Mart nor Sam’s Club has publicly commented on China’s strong opposition to them. Zhang has not commented on Wal-Mart’s situation. Wal-Mart has also been accused of removing products from western China from its offline stores and apps.
This controversy triggered a wave of Sam’s Club shoppers in China canceling their memberships, highlighting the fact that foreign companies are walking a tightrope in China because of their geopolitical tensions between China and the West and China’s importance as a market and supply base Strike a balance between.
Xinjiang has become a growing point of conflict between Western governments and China, as UN experts and human rights organizations estimate that more than one million people, mainly members of Uyghurs and other Muslim minorities, are detained in camps there.
China rejected allegations of forced labor or any other abuses in Xinjiang, describing the camps as career centers aimed at combating extremism, and stated at the end of 2019 that everyone in the camps had “graduated”.
In addition to Wal-Mart, Swedish fashion retailer H&M and American chip maker Intel (NASDAQ:) have been criticized in China for adjusting their Xinjiang operations in recent months. In contrast, Tesla (NASDAQ:) was criticized by the U.S. human rights organization for opening a showroom in Xinjiang on December 31.
Soon after US President Joe Biden signed legislation banning imports from Xinjiang on December 23, Chinese social media users opposed Sam’s Club for fear of forced labor.
Zhang said that at Sam’s Club, which has 4.4 million members in China, about 500 shoppers in the central region have cancelled their membership cards. He did not give a national number.
“This has a negative impact on our membership base, but time will prove everything in the future,” he said.
“We think that China has great potential.”
China is a huge market for Wal-Mart, which generated 11.43 billion U.S. dollars in revenue in the fiscal year ended January 31. Of the 423 retail stores operated by Wal-Mart in China, 36 are Sam’s Clubs, according to its website.