Australians’ appetite for cheap electronics, fast fashion and new cars is carrying a hidden cost, with analysis estimating almost $100 billion worth of imports last year were exposed to forced labour risks.
New modelling from supply chain risk intelligence platform Fair Supply found more than 21 per cent of all goods brought into the country in the past financial year – about $1 in every $5 spent on imports – were linked to supply chains where coercion, debt bondage and other forms of modern slavery are known to occur.
Electrical machinery, apparatus and appliances topped the list, with $12.9 billion of Australia’s $28.3 billion spend in the category assessed as high risk. Telecommunications equipment, including mobile phones and network hardware, accounted for a further $11.5 billion in imports exposed to modern slavery concerns, much of it sourced from China and Malaysia.
The findings come as the federal government reviews Australia’s Modern Slavery Act, introduced in 2018, which requires large companies to report on the risks of modern slavery in their operations and supply chains. Critics say the regime has improved transparency but failed to drive meaningful change.
Globally, more than 28 million people are trapped in forced labour on building sites, in factories and on fishing vessels, or working in farms and private homes under threats, violence or coercion they cannot escape. In Australia, more than 40,000 people are trapped in modern slavery. Migrants working in agriculture, construction and meat processing are particularly vulnerable.
Grace Forrest, the founding director of Walk Free – an international human rights group focused on the eradication of modern slavery – said that after eight years Australia’s laws had failed to bring change at the scale required.
Clothing is also among the most vulnerable sectors, with $11.4 billion – nearly 90 per cent of Australia’s total apparel spend – tied to countries where forced labour is prevalent in garment production, including China, India, Brazil and Argentina. Road vehicles and parts added $8.9 billion in at-risk imports, while textiles contributed $3.4 billion, representing three-quarters of that category’s total spend.
“That is a staggering figure which should shock us,” she said. “But it’s not about blaming consumers. Supply chains remain opaque and it is nearly impossible to shop slavery-free. The responsibility sits squarely with government and business.”
Forrest said that forced labour was not accidental or rare but built into complex supply chains that stretched across borders and into Australia’s economy. She said Australia needed to introduce a due diligence obligation, requiring Australian companies to move beyond disclosure and take reasonable, proportionate action to prevent forced labour, identify high-risk supply chains and provide remedy to people who have been exploited.
There is a global trend towards tougher laws that compel companies to act rather than simply disclose risks. Mandatory human rights due diligence obligations are already in place across the European Union, Germany, France, Norway and Switzerland, and are being considered in Britain, Canada, South Korea, Thailand and Indonesia.
Australia’s Anti-Slavery Commissioner, Chris Evans, said that introducing a due diligence system would strengthen protections for vulnerable workers while giving businesses greater certainty.
Evans noted that due diligence-style obligations were already embedded in other areas of Australian law, including work health and safety, foreign bribery, privacy, illegal logging, environmental protection, sex discrimination and online safety.
“We have known for years that the Modern Slavery Act’s transparency measures alone have not created meaningful impact for exploited workers,” he said. “Currently, reporting is mandatory, but taking action is not, leaving workers exposed and responsible businesses disadvantaged.”
He said that Australia risked becoming a dumping ground for products rejected elsewhere if it failed to keep pace, as major trading partners including the United States, the European Union, Canada and Mexico banned goods made with forced labour.
New European due diligence rules are also expected to have a “trickle-down” effect on Australian exporters, with businesses needing to demonstrate their supply chains were free of exploitation or risk losing access to key markets.
Business groups have signalled concerns that new reporting obligations would risk diverting attention from practical initiatives that more effectively address the modern slavery risks faced by Australian businesses. They argue that when resources are absorbed by mandatory reporting, entities may have less capacity to invest in activities such as staff training, comprehensive risk assessments and supplier audits.
Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter.
Rob Harris is the national correspondent for The Sydney Morning Herald and The Age based in Canberra. He is a former Europe correspondent.Connect via email.
