Bangladesh likely to get back GSP facility: US House

The United States (US) is likely to reinstate the GSP (generalised system of preferences) facility for Bangladesh, when the US parliament approves a bill renewing GSP facilities for 127 poor countries in September, informed sources said on Sunday.

The GSP programme for the developing countries expired on July 31, and the US parliament is likely to renew the trade facilities when the Congress resumes session early next month.

However, before expiry of the facility, the administration of President Barack Obama suspended it for Bangladesh on June 27, following the collapse of the Rana Plaza at Savar in Dhaka that killed more than 1,130 workers and maimed many on April 24 last.

Several members in the House of Representatives and the Senate recently introduced a bill to renew the GSP programme that benefits developing and least developed countries including Bangladesh.

As the US parliament is likely to renew the GSP for the poor countries, a senior member of the House of Representative and leader of the ruling Democratic Party is scheduled to arrive in Bangladesh tomorrow (Tuesday).

House (of representative) Member Sandy Levin has undertaken a three-day visit to see efforts of the government and the relevant stakeholders in the garment sector in improving factory safety, according to a statement of the office of Mr Levin.

"The lawmaker and leader of the Democrats will discuss ways and means to improve working conditions in factories in Bangladesh," an official at a leading garment buying house told the FE.

Mr Levin is likely to visit a number of garment factories and meet factory workers, employers, business leaders, senior officials of the government and some short-listed non-governmental organisations.

A proponent of the decision to suspend the GSP facility for Bangladesh, Mr Levin was in favour of creating pressure on the impoverished country to make better progress in improving working conditions and addressing other safety issues.

"His recommendations and feedback to the US administration are likely to play a great role in reinstating the GSP facility," he said.

Meanwhile, the Bangladesh government and the stakeholders have started implementing a number of programmes to improve workers' rights and safety standards in factories, according to officials at the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

Besides amendments to the labour law by the government, stakeholders are also planning to announce a new wage structure for the workers, said a leader of the BGMEA.

If Bangladesh can convince the visitor with its efforts taken anew to improve workers' rights and safety standard at workplaces, the US administration is likely to reinstate the GSP facility, once the parliament renews the GSP programme, they said.

Meanwhile, traders and consumers in the US have demanded renewal of the GSP benefits for poor countries, according to The Coalition for GSP, a Washington-based group of US businesses, trade associations, and consumer organisations.

President Barack Obama suspended the GSP facilities as the country had failed to protect rights of workers and improve safety standards in factories despite repeated warnings since 2007.

The GSP facilities allow duty-free access for some 5,000 products to enter the US market from least developed countries.

Mr Levin and other Congressmen from the Democratic Party have urged Bangladesh Prime Minister Sheikh Hasina to join in a comprehensive, concrete and coordinated plan to ensure workers' safety and their rights.

He also pressed the White House, in a letter to the President, to convene representatives of the European and US retailers, the Bangladeshi garment industry, garment workers, their unions and the government, the International Labour Organisation, and non-governmental organisations to help develop a concrete plan to address the range of workers' issues.

However, the GSP suspension was symbolic as it would affect less than 1.0 per cent of the exports from Bangladesh to the US, when the dominant garment exports did not enjoy the facility in the largest economy of the world, traders said.

Developing countries and LDCs are benefited as they can export up to 5,000 types of products free of duty to the US.

Last year the US imported goods worth $20 billion under GSP facilities, including nearly $35 million from Bangladesh, which included tobacco, sports equipment, porcelain china and plastic products.

However, Bangladesh exported garment products worth nearly $5.0 billion to the US during the year.

News Source: 
The Financial Express