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‘GSP freeze not to penalise Bangladesh’

  • Senior Correspondent,
    Published: 2014-04-28 01:37:50 BdST

The GSP privilege suspension in the US market was “not to penalise” Bangladesh, the Assistant US Trade Representative for South Asia has said ahead of the maiden Ticfa meeting on Monday.

Michael Delaney will lead the US side while Commerce Secretary Mahbub Ahmed will lead Bangladesh.

He said on Sunday in Dhaka the purpose of suspending trade benefits was “rather to send a strong signal about the urgent need to address these concerns”.

He termed this US decision in June last year President Barack Obama’s “extraordinary step” and that his decision was based on Bangladesh’s failure to meet the GSP requirement.

Under the GSP requirements, countries take steps "to afford internationally-recognised worker rights”.

The US suspended GSP privilege that some of Bangladesh’s products were enjoying in its market after Rana Plaza in Savar collapsed in April, killing more than 1,100 people, mostly garment workers.

The US–Bangladesh Trade and Investment Cooperation Forum Agreement (TICFA) was signed on Nov 25 last year.

Speaking at the Dhaka Chamber of Commerce and Industries (DCCI), Delaney said it was the “primary mechanism” for the US and Bangladesh to discuss trade and investment issues.

He said it provided a forum to address “important related issues” such as the environment, intellectual property protection, worker rights and worker safety, and the economic empowerment of women.

He said a full range of trade and investment issues would be discussed at Monday’s meeting.

“We look forward to establishing a TICFA Labor Affairs Committee and a TICFA Committee on Women’s Economic Empowerment where we can jointly work on these important issues with an interagency and inter-ministerial team of experts,” he said.

The Ticfa meeting would also review two-way trades and investment and progress on the action plan that US rolled out after suspending the GSP.

Bangladesh will raise the issue of duty- and quota-free access to the US market at the meeting, officials said.

Delaney said the US government had provided ‘millions of dollars’ in technical assistance to help improve building and fire safety and the ability of workers to exercise their fundamental rights.

“Also, at the time of the President’s decision on GSP, we provided the government of Bangladesh with an Action Plan containing recommendations on actions that Bangladesh could take to provide a basis for reinstatement of GSP benefits,” he said.

The meeting would also review the implementation of the action plan.

He said every stakeholder both Bangladeshi and international have crucial role to play to ensure factory safety and workers rights.

According to Delaney, ultimately it will be up to the government of Bangladesh to coordinate all of these efforts and put in place the legal and regulatory environment to address and solve these challenges.

However, Bangladesh’s ambassador to Washington Akramul Qader earlier asserted that the US decision did not help the clothing industry recover from the shocks of Rana Plaza and Tazreen Fashions fire, rather “put the workforce into jeopardy”.

Even Finance Minister AMA Muhith has lashed out at the US saying it was refusing Bangladesh duty and quota privileges for political reasons.

Bangladesh’s main export item readymade clothes never enjoyed the facility, but the GSP revocation sent a negative signal worldwide.

Bangladeshi garments enter the US market after paying tariff ranging from 8 to 32 percent which ambassador Qader said was “exceptionally high”.

He said Bangladesh had exported $4.90 billion of ready-made cloths to US market last year and paid tariffs of almost $ 820 million.