U.S. Weighs Tougher Line on Bangladesh Trade

[CaPtAiN_pLaNeT]

U.S. Weighs Tougher Line on Bangladesh Trade

By JOSH MITCHELL

U.S. Weighs Tougher Line on Bangladesh Trade - WSJ.com

The Obama administration is considering removing tariff breaks on certain goods imported from Bangladesh, stepping up pressure on the government there to improve safety standards after a deadly building collapse.

U.S. officials will deliberate in coming weeks on whether to change the tariffs, which would hit a small slice of Bangladeshi imports including tobacco, golf equipment, ceramics and garments such as headbands. Those goods currently benefit from a program that provides tariff breaks for developing countries.

A decision could be made by the end of June, said an official at the U.S. trade representative's office.

The move would be a largely symbolic step by the U.S. government, which for years has been under pressure by labor unions to take a tougher line on Bangladesh and its textile and apparel industries. The issue has gained attention since the April 24 collapse in Bangladesh of a building housing garment factories that killed more than 1,110 people. A November fire in a separate Bangladeshi factory killed 112 people.

Bangladesh's garment and textile industries make products for numerous international retailers, including Wal-Mart Stores Inc. WMT -0.80% and Gap Inc. GPS +0.91%

U.S. officials emphasized they haven't settled on what action to take and that the tariffs under consideration would hit only about $35 million of imports—a fraction of the billions of dollars in goods Bangladesh sends to the U.S.

The officials said such a move would be designed to spur the government to improve safety standards for its workers—concerns that the U.S. had raised long before the building collapse.

"The building collapse shines a sharper light on the underlying issues that we've been working with the Bangladesh government at this time," said Bill Jackson, a deputy assistant U.S. trade representative.

The Washington Post earlier reported on the Obama administration's consideration of removing tariff breaks for Bangladeshi goods.

U.S. labor unions have lobbied federal officials for years to take a tougher line on the Bangladeshi government, which they accuse of restricting workers' ability to unionize and having lax safety standards. The current deliberations, which include officials from the U.S. trade representative's office, the State Department and other agencies, stem from a petition filed by the AFL-CIO in 2007. U.S. officials are in talks with the Bangladesh government on the matter.

Attempts to reach officials at the embassy of Bangladesh in Washington, D.C., were unsuccessful.

Bangladesh is among a number of developing countries that receive breaks on U.S. tariffs under a program known as the Generalized System of Preferences, designed to promote economic growth around the globe. U.S. officials are considering several options, including temporarily suspending the breaks or removing them permanently for Bangladesh.

The U.S. trade representative's decision would amount to a recommendation to President Barack Obama, who would make the final decision.

Write to Josh Mitchell at joshua.mitchell@dowjones.com

 

[eastwatch]

I think, US stance is correct. A developing country like BD needs some tough external pressure to correct labor laws, develop the working conditions and improve the building design and construction codes. However, this soft US gestures may only be wrongly perceived by the relevant parties.

 

[UKBengali]

I think, US stance is correct. A developing country like BD needs some tough external pressure to correct labor laws, develop the working conditions and improve the building design and construction codes. However, this soft US gestures may only be wrongly perceived by the relevant parties.

The US may be testing the waters here.

If BD ignores implementing tougher safety laws then a more widespread basket of goods will be affected.

 

[Zabaniyah]

It's pretty pointless blaming the US in this matter

The Bangladeshi manufacturers are more than capable to afford increases in their value chain. These include pay, and workplace safety. And these don't necessarily count as primary activities.

They should understand that there are significant economic incentives if such steps are taken.

If they fail on their part, the ball's in their court.

 

[eastwatch]

It's pretty pointless blaming the US in this matter

The Bangladeshi manufacturers are more than capable to afford increase their value chain. These include pay, and workplace safety. These don't necessarily count as primary activities.

They should understand that there are significant economic incentives to take such steps as well.

If they fail on their part, the ball's in their court.

Well, payment increase is the easier part of the comprehensive measures comparing to guarantee the workplace safety. There must be many features of workplace safety, but placing the machines and thousands of workers in SAFE buildings will not come easy.

Removing the possibility of fire death or hazard is quite possible to achieve by at least two-step measures: 1) Provide additional EMERGENCY EXIT/STAIRS at the other side of the Main Entrance/Collapsible Gate, and 2) DO NOT lock the Main Entrance and Emergency Exit open any time.

I still remember how by the explicit order of the self-centered newly rich Owner of that Ashulia factory, 112 workers died a miserable death by fire.

 

[Shazhina]

okay, how are bangladesh TIES with the west/europe and the rest of asia?

is it on good terms with indians and pakistanis??

 

[Zabaniyah]

Well, payment increase is the easier part of the comprehensive measures comparing to guarantee the workplace safety. There must be many features of workplace safety, but placing the machines and thousands of workers in SAFE buildings will not come easy.

Removing the possibility of fire death or hazard is quite possible to achieve by at least two-step measures: 1) Provide additional EMERGENCY EXIT/STAIRS at the other side of the Main Entrance/Collapsible Gate, and 2) DO NOT lock the Main Entrance and Emergency Exit open any time.

I still remember how by the explicit order of the self-centered newly rich Owner of that Ashulia factory, 112 workers died a miserable death by fire.

Agreed about the fire safety part.

If we look at the Savar tragedy, the building was built without the supervision of Rajuk. If memory serves, it is a tiring and a timely process to get their approval for a building. Bangladesh does have well placed building safety standards. They just aren't always implemented. Especially in areas like Savar.

They should ease such barriers while ensuring that the building meets minimum standards. Yes, that part is difficult.

Fun fact: The plot in which Rana Plaza was built was stolen land from a minority owner.

okay, how are bangladesh TIES with the west/europe and the rest of asia?

We have generally amicable ties with the West and the rest of Asia.

is it on good terms with indians and pakistanis??

Depends on who's in charge.