WASHINGTON — The World Bank is investigating whether a $50 million loan it granted in 2015 for an education project in China’s Xinjiang region has been used to fund Muslim detention camps.
The review comes amid growing global concern that China has detained one million or more Muslim Uighurs and placed them in “re-education” camps where they are forced to renounce their religious beliefs and embrace the ideology of the Communist Party.
The Trump administration, which has largely been quiet about human rights issues in China, has recently escalated criticism of activities in Xinjiang, and foreign companies that operate there are facing increased scrutiny from advocacy groups.
The controversy is the first major test for the World Bank’s new president, David Malpass, a China hawk and former Treasury Department official who assumed the role this year after being selected by President Trump.
“We take such concerns extremely seriously,” David Theis, a World Bank spokesman, said in a statement released Thursday night. “We are actively looking into the questions that have been raised about the project. If action is warranted, we will take it.”
The loan was made in 2015, under the bank’s previous leadership and two years before the internment camp program started in earnest. It was a relatively small amount of the total $1.8 billion the bank lent that year to China.
The $50 million is scheduled to be disbursed through next year. When the bank unveiled the plan, it said that the money would benefit thousands of young people in the region by offering them “better technical and vocational education and employment opportunities” through the support of five local colleges.
More than half of the estimated 24 million people in Xinjiang, an area about the size of Alaska, are Muslim ethnic minority groups. Most of them are Uighurs, who have a history of cultural independence and resistance to Chinese rule. China began cracking down on the region after a spate of antigovernment attacks in 2014, but most analysts say that the mass detentions and effort to forcibly indoctrinate the Uighurs began in 2017.
Questions about the project emerged last week after Senator Marco Rubio, Republican of Florida, and Representative Jim McGovern, Democrat of Massachusetts, released a letter to Mr. Malpass outlining concerns about the loan. The letter noted that disbursement of the loan continued even after it became evident that the Chinese government was spreading propaganda to defend the camps.
The two lawmakers, who lead the Congressional-Executive Commission on China, asked Mr. Malpass to provide proof that the bank’s money was not being misused for involuntary internment under the guise of “vocational education.”
“We believe such actions may constitute crimes against humanity perpetrated by the Chinese government against Uighurs and other Turkic Muslim minorities,” they wrote.
The controversy over the loan was inflamed this week after Foreign Policy magazine reported that a World Bank employee sent a letter to an executive director on the bank’s board last month listing numerous red flags about the educational project in Xinjiang and calling for a formal inspection of the work to ensure that the bank’s policies are being honored. Mr. Theis said that he was not aware of the letter but that its existence was possible.
And this week, Shawn Zhang, a Chinese-born law student at the University of British Columbia who researches Xinjiang, wrote in a report on Medium that it “is possible that this World Bank project is indirectly involved in Xinjiang’s human rights crisis.” Although he said that he believed the link was weak, he pointed to a tender notice from one of the vocational schools affiliated with the bank’s project. The notice suggested the school was spending money on security items like 100 police batons and 30 tear gas launchers.
The World Bank said in its statement that it had conducted “supervision missions” twice a year since the project started to review procurement and financial management and that all goods and services bought using bank funding were subjected to annual audits by World Bank-approved auditors.
The bank was not previously aware of the purchases of the security equipment because its audits covered only the five schools that it was directly funding. The investigation that is underway will cover “partnership schools” that are affiliated with those institutions.
While supervisory work tends to be undertaken by staff in the region, the World Bank now plans to send officials from its Washington headquarters for site visits.
The results of the review could place the World Bank in an uncomfortable position with China, which is one of its largest shareholders and also a major borrower of bank funds.
Adrian Zenz, an independent expert on China’s ethnic policies, said it was premature to draw a direct link between China’s internment camps and the World Bank’s loans, noting that the vocational training colleges it is working with are different from the involuntary labor programs that have been the subject of attention. But he said the investigation deserved serious treatment.
Other experts are more convinced of a link. James A. Millward, a professor at Georgetown University and an expert on the Xinjiang region, said that the internment camps in Xinjiang are being run jointly by local authorities and the Xinjiang Production and Construction Corps, or Bingtuan, suggesting misappropriation of the World Bank’s money would not be surprising.
“The likelihood of any World Bank-funded project being associated with the concentration camps, or entities directly running the camps, is high,” Mr. Millward said.
He added that foreign companies that have operations in Xinjiang or that source materials there that could have been produced with forced labor should also think twice about the policies that their funds are supporting.
The World Bank has for years faced criticism when its work wades into countries where human rights concerns are pervasive. In the late 1990s, the bank came under fire for the China Western Poverty Reduction Project, which would have relocated 58,000 Chinese farmers to the edge of Tibet. Human rights groups accused the Chinese government of trying to dilute the Tibetan population, and the Dalai Lama warned that the move would create problems.
The World Bank eventually scrapped the plan, and an internal report suggested that the bank had bent its own rules to accommodate China’s leaders.
As recently as this year, groups like the Center for Global Development questioned why the World Bank was lending money to Myanmar despite abuses by the government against Rohingya Muslims.
Mr. Malpass has said that he believes lending to China should be scaled back given the size of its economy. In 2017, the bank lent $2.42 billion to China. This year, the total is expected to fall to $1.33 billion.
Development experts argue that the bank’s money must be accounted for more closely.
“Clearly, there are a lot of questions to be answered, particularly at a time when the whole world is concerned about human rights issues in Xinjiang,” said Paul Cadario, who was the World Bank’s principal country officer for China from 1987 to 1993. “You’d expect that the World Bank would be on the right side of history.”