Xinjiang Dealmaking Overcomes Sanctions Deterrent

Xinjiang Dealmaking Overcomes Sanctions Deterrent Xinjiang Dealmaking Overcomes Sanctions Deterrent Executive Summary: - The Xinjiang Production and Construction Corps (XPCC), sanctioned by the United States since 2020, is making overt appeals for international investment. This is likely a result of positive incentives and economic opportunities rather than a response to external sanctions. - The ease with which the XPCC can identify foreign patrons and the candor of its calls for international investment suggest that the efficacy of U.S. sanctions is limited. - Outreach, platformed by trade expos and elevated by the One Belt One Road (OBOR) initiative, appears to have achieved both political and financial successes, with foreign politicians giving speeches at these events and investment deals inked since 2025 reportedly totaling over $1.5 billion. The 9th China–Eurasia Expo (中国-欧亚博览会) convened in Urumqi from June 25–29, bringing more than 3,000 companies from around the world to the capital of the Xinjiang Uyghur Autonomous Region (XUAR) (Belt and Road Journalists Network, June 28). The United Arab Emirates (UAE), Russia, South Korea, and Thailand were represented for the first time, and Kazakhstan and Pakistan were named nations of honor as longstanding participants (Xinhua, June 27; Belt and Road Journalists Network, June 28). This expo, and others like it, advance the Chinese Communist Party’s (CCP) goal of normalizing the XUAR among foreign elites, despite the CCP’s ongoing human rights abuses in the region. [1] The XUAR’s geographic position makes it central to Beijing’s efforts at global connectivity and overland economic engagement. Expos and other trade shows serve to integrate the XUAR’s governance structures with global businesses. This integration continues to take place alongside successive CCP campaigns that erode Uyghur autonomy, and while U.S.-led efforts seek to restrict economic engagement with the region in response. [2] The clearest evidence of the limitations of those efforts is the successful global engagement of the Xinjiang Production and Construction Corps (XPCC; 新疆生产建设兵团), which has capitalized on these expos to attract billions of dollars of foreign investment in recent years. Expos Call to ‘Invest in the XPCC’ Recent expos in Urumqi have voiced unique appeals to “invest in the XPCC” (投资兵团). These calls first emerged as an official characterization of bilateral signing ceremonies and now stand out as candid requests to support the CCP’s settler-colonial body in the region. The XPCC, which maintains the paramilitary institutions of its origin as a settlement of decommissioned World War II soldiers, advances the Party-state’s goals of diluting the Uyghur population, building an extensive surveillance network, and constructing prisons and internment camps (Uyghur Human Rights Project, April 26, 2018, August 27, 2020; Miller et al., May 2025). [3] While the United States sanctioned the XPCC in 2020, this lever never fully isolated the entity due to its “integration with the corporate, trade, and financial landscape within Xinjiang, China, and the greater region,” according to analysis by the Center for Advanced Defense Studies (C4ADS) (Department of the Treasury, July 31, 2020; C4ADS, August 10, 2021). The call for investment is likely driven more by opportunity than a result of any Western pressure. The People’s Republic of China (PRC) established the China (Xinjiang) Pilot Free Trade Zone, covering Urumqi, Kashgar, and Khorgos, in 2023. Along with the development of the One Belt One Road (OBOR) initiative’s overland Silk Road Economic Belt (丝绸之路经济带), the XUAR has become a hub for overland trade as PRC–Eurasia trade flows increase (China Brief, October 17, 2025). Foreign politicians have responded positively to the XPCC’s appeals at recent investment conferences and expo sessions. At the 2025 Eurasia Commercial Trade Expo (亚欧商品贸易博览会), for example, an “invest in the XPCC” session saw speeches from Avazbek Kerimbaev, vice chairman of the Chamber of Commerce and Industry of Kyrgyzstan, and Yang Hai (杨海), president of the International Chamber of Commerce of Cambodia (Tianshan Net, June 28, 2025). Yang has supported economic engagement with the XPCC since at least 2024, when he established an XPCC branch for his chamber of commerce (柬埔寨国际商会新疆建设兵团分会) (Jianhua Daily, November 6, 2024). In the 2026 China–Eurasia Expo, Malaysian senator and Malaysia–China Business Council chairman Low Kian Chuan (卢成全) gave the keynote address, where he suggested that Malaysia could serve as the conduit for the XPCC’s entrance into Southeast Asia (The Star, June 30; Facebook/Malaysia-China Business Council, July 2). The participation of these foreign participants, albeit in an unofficial capacity, reflects the lack of stigma attached to conducting business in the XUAR—and with the XPCC—in much of the world. The XPCC’s appeals for cooperation over the past few years have produced repeated financial successes. As a result of its participation in the 10th China International Consumer Goods Expo (中国国际消费品博览会) in 2025, the XPCC signed agreements for 12 projects priced at $750 million (XPCC Daily, April 15, 2025). At the 8th China International Imports Expo (中国国际进口博览会), also in 2025, the XPCC announced deals covering a further 23 projects, including ten foreign investments that totaled $440 million (XPCC, November 11, 2025). The most recent event, the 2026 China–Eurasia Expo, produced agreements for 18 projects, including 12 with foreign partners, totaling $516 million (China Daily, June 26). Conclusion The XPCC and the XUAR regional government have found a feasible and relatively simple workaround to U.S. sanctions. Rallying behind OBOR investments and the PRC’s friendly relations with its neighbors, foreign investment now drives the XPCC’s development, despite U.S. attempts to cut it off from the global economy. Its expo-based dealmaking shows that the financial burden of U.S. sanctions has been outmatched by the allure of OBOR-related profits. If the XPCC can be so explicit in its calls for foreign investment and still come away with deals while under U.S. sanctions, the United States needs a new approach to achieve its foreign policy goals in the XUAR. As of now, the XPCC is still benefiting from the PRC’s regional diplomacy and economic integration across Eurasia. Notes [1] Religious and ethnic repression continue to take on new forms. For instance, the expo concluded just days before the Ethnic Unity and Progress Promotion Law came into effect on July 1. [2] XUAR-based expos are the most visible aspect of the PRC’s attempts to integrate the region with the global economy. Chinese digital trade networks, such as Alibaba’s electronic world trade platform and its logistics arm, Cainiao (菜鸟), operate to obscure XUAR-origin goods and facilitate their shipment around the world (China Brief, May 28, June 6). [3] Miller, Frank, Tung Ho, Kenneth Allen, and Arran Hope, eds. The People’s Liberation Army as Organization Volume 3.0. Washington, D.C.: The Jamestown Foundation; Vienna: Exovera, 2025.