Added anxiety to export

Although the suspension will not directly affect

the readymade garment industry, as the
preferences are limited to products such as
tobacco and ceramic goods and do not apply to
clothing exports, there is a palpable fear that
others like the European Union could consider a
ban on preferential imports of readymade
garments. And in diplomatic terms this is the
first move, however symbolic, from the
superpower following the aftermath of the April
disaster, writes Irfan Chowdhury
Very few governments, businesses or politicians
have accepted their failures without making
excuses or even lame excuses. But no Bangladeshi
government has ever accepted its failing; fingers
have always been pointed at others, highlighting
their faults, or grand conspiracy theories have been
orated against them and at the nation, inevitably

reinforcing their devout role in guarding the

countrys
interests.
So the actions and reactions of the government and
businesses in the wake of the latest blow to our
exports in the form of a US decision to suspend its
Generalized System of Preferences (GSP) with
Bangladesh
were
hardly
surprising.
The various analyses of the decision have been
more interesting than the ban itself it was the
combined act of a certain interest group within and
outside the country; it was due to unrelenting
lobbying for a number of years by the American
Federation of Labor and Congress of Industrial
Organizations regarding workers rights in
Bangladesh that wrongly alleged workers rights
issues in export-processing zones and the readymade garments sector; it was due to a letter from
the leader of the opposition earlier in year seeking
foreign intervention; it was a political rebuke by the
US on a number of issues including mistreatment of
Professor Yunus and his Grameen Bank.
But although the suspension will not directly affect
the readymade garment industry, as the
preferences are limited to products such as tobacco
and ceramic goods and do not apply to clothing
exports, there is a palpable fear that others like the
European Union could consider a ban on
preferential imports of readymade garments. And in

diplomatic terms this is the first move, however

symbolic, from the superpower following the
aftermath
of
the
April
disaster.
To ascertain the possible impact of the ban,
according to the Export Promotion Bureau,
Bangladesh, the total exports during 2011-12 fiscal
were $24 billion; exports to the US accounted for
around $5.1 billion, about 21 percent of the
countrys total export. The export share for apparel
was
worth
$4.53
billion.
While the US authority said this is an opportunity for
Bangladesh to prove itself in providing work safety
and a decent wage, the factory owners and the
industry business leaders (through their opinion
pieces and commentary) along with the peak body
Bangladesh Garment Manufactures and Exporters
Association (BGMEA) did not waste a moment in
denouncing that this cannot be a reaction to the fire
accident or the building collapse which, combined,
killed over 1300 people. In their shock and dismay
they prefer to consider this to be a politically
motivated move, believing that appropriate actions
have been taken, some factories having been
closed for safety reasons, a wage board having
been set up, and foreign buyer groups such as
Walmart are signing up to the industry safety
revamp
schemes.
Whichever way industry and government want to

take this, there can hardly be any doubt that this is

a clear message to them for repeated failures to
take swift and appropriate remedial action. As the
New York Times editorial on June 27th went:
We have urged American and European
companies to demand that suppliers improve
working conditions and help to pay for factory
renovations. But the fundamental responsibility lies
with Bangladeshs leaders, who have repeatedly
said the government would beef up inspections and
make it easier for workers to form unions, but has
not
done
enough
to
follow
through.
There is little doubt that revoking trade preferences
will hurt businesses that are not responsible for the
poor conditions in clothing factories. But Western
governments have a right, which they have rarely
used, to suspend these benefits when countries like
Bangladesh repeatedly refuse to live up to their
obligations to protect the rights and lives of their
workers.
Leaders are unlikely to change policies that are
unpopular with the powerful families that own
clothing factories unless they are forced to do so.
American and European leaders have few tools to
exert such pressure, which is why they must use
the ones they do have when the lives of millions of
poor
workers
are
at
stake.
There have been more fires since the Rana Plaza

disaster. No compensation or rehabilitation program

for the victims has been commissioned by BGMEA.
A ten-point roadmap surfaced among another group
of eminent industry owners but it needs further
refinement. We also understand that there is
tension and disharmony among lobbies within the
owner
groups.
There is a sea of analyses and recommendations
listing reforms with immediate, short and long term
milestones, which can be summarised into a few
urgent actions: provide significant compensation to
victims and their families; fix an acceptable
minimum wage; allow workers to form unions;
immediately audit all factories to identify and shut
down those at risk; inject properly trained factory
inspectors to conduct random checks and to impose
hefty fines; and above all attempt to overcome the
prevailing
corruption.
From the perspective of foreign consumers and
buyers, while pressuring our government through
restricting trade privileges may have been thought
to be effective, to improve working conditions in the
apparel companies is what is most needed, which
hardly gets done as there are lobby groups and
MPs in parliament who have high stakes in the
industry.
Even now many factories are operated with unsafe
and exploitative working conditions - for example,

with makeshift or non-existent proper fire exits, with

no proper breaks or overtime pay. Enforcing
international safety and health standards will be the
most effective way to save workers, but this will
need a huge fund to which all stakeholders should
contribute.
Western retailers having come under enormous
pressure following the disaster have agreed to chip
in or are in the process of doing so even though
big retailers such as GAP or Walmart have not
joined a collective plan, it has been reported that
they are close to initiate their own factory repair
schemes.
In the end even if this huge fund that is required to
repair and upgrade the conditions of factories, such
as better exits and fire safety, is found, the
government has to do its bit ensuring strict
application of regulations and administration of
laws. There are already laws on paper, such as the
building codes but they are not obeyed or applied.
In the absence of these provisions, local contractors
use subcontractors who do not meet safety
standards or give a decent wage to poor workers.
This rudimentary and dodgy conduct cannot be too
hard for foreign governments to detect. Perhaps
they should encourage big retailers to address their
invigilance
when
contracting
out
orders.
The industry has exploited workers for a long time

and this is well known. Although there are counter

arguments stating that it is very hard to make a
super-profit or sustainable business ventures due to
numerous constraints forcing many to go belly up,
by and large this has been an industry where one
could dream of becoming rich quickly, if all went
according to plan. This motivation among factoryowning businesses and foreign retailing businesses
is the reason why things never really improve. Of
course there are other issues such as the
enforcement of international laws and local
regulations to protect workers from abuse.
On the other hand maybe there is a strong belief
among the stakeholders and analysts that, at least
for now, there isnt an alternative to Bangladesh for
the buyers, as infrastructures, legal framework,
governance or working conditions are not so much
better in other like countries which could provide
such cheap labour. And that, as a consequence of
ongoing intense scrutiny and efforts, the RMG
sector will slowly improve by itself when bigger,
better and compliant factories will replace the
shonky
ones.
In that situation, perhaps the most important issue
or risk is not that we will lose business or we will be
boycotted by western consumers. Rather, the real
risk is without leadership, honest administration and
a strategic plan to gradually move onto other

sectors, we might be stuck with the RMG sector.

Countires that have industralised, from nineteenth
century England to modern China, went through a
clothing/textile/leather phase (even the post second
world war Japan made shoes and tee-shirts in
1950s), but as we know they have successfully
moved on from that phase. The irony is, by
suspending GSP, US is hitting precisely those nonRMG sectors. And no one is at all talking about that.
Nevertheless, months of criticism from most of the
major media outlets in the world and continued
pressure from foreign governments have failed to
invoke credible speedy action in the RMG sector.
Nor has a plan been developed to restore global
confidence as critical arguments acceptable work
conditions, work safety, governance, factory
monitoring and fair wages are ignored by the
industry.
Amid the suspensions there has been no shortage
of recondite fulmination from authorities that they
have taken many steps: labour law reform, ILO-led
tripartite agreement to implement time-bound
decisions and the formation of a ministerial panel to
ensure
compliance
in
garment
factories.
But these abstract statements increasingly create
more anxiety that tangible, sincere actions to
address
the
workers
woes
will
linger.

AlalODulal.org, July 6, Irfan Chowdhury is a

member of editorial board of AlalODulal.org