An uncertainty looms large over Bangladesh's immediate restoration of the GSP benefit in the US market as the USTR is not satisfied with the progress so far made by the government in ensuring workers rights and safety issues in the apparel sector.
In response to the progress made by Bangladesh in implementing the specific measures listed in the Action Plan, an interagency review led by the Office of the US Trade Representative (USTR) has found that Bangladesh has failed to implement substantial parts of the plan.
" Bangladesh has made some important progress, but must do more to address the worker rights and worker safety issues that led President Obama to suspend the country's Generalized System of Preferences (GSP) trade benefits in June, 2013," the USTR in a statement issued Wednesday said.
At the time of the suspension, the Administration provided the Government of Bangladesh with an Action Plan which specifying a basis for the President to consider the reinstatement of GSP trade benefits.
"However, the review also found that Bangladesh has not yet implemented substantial parts of the Action Plan," the USTR said in the statement.
The government is behind the schedule in carrying out hundreds of critical safety inspections in garment factories, as well as meeting its commitments to hire additional inspectors, it said adding the government has also been slow to respond to continuing reports of harassment and violence against labour activists.
"The government needs to develop a credible and effective mechanism for responding to and addressing allegations of unfair labour practices," the review concluded.
"Since the suspension of GSP, the government has also not advanced the labour law reforms called for in the Action Plan, including changes to ensure that workers are afforded the same rights and protections in Export Processing Zones as in the rest of the country," it noted.
"The Obama Administration has been engaging the Bangladesh government and stakeholders over the past year to press for changes to address the worker rights and worker safety issues," said the United States Trade Representative Michael Froman.
"We are seeing some improvements that move us closer to our shared goal of protecting workers from another workplace tragedy such as the April 2013 Rana Plaza building collapse, including a significant increase in the registration of unions," he added.
"However, we remain concerned about the large number of factories that have yet to be inspected, the lack of progress on needed labour law reforms, and continuing reports of harassment of and violence against labour activists who are attempting to exercise their rights."
The USTR, however, also lauded the progress in some areas citing example of 120 new unions' registration since June, 2013. It praised Bangladesh's move to drop pending criminal charges against labour activists, its cooperation with the Accord and the Alliance as part of the plans to inspect garment factories and reportedly suspension of production in about 20 factories due to having structural flaws.
The review was conducted by the USTR-chaired GSP Subcommittee of the interagency Trade Policy Staff Committee, which includes representatives of the Departments of State, Labour, Commerce, Agriculture, and the Treasury, as well as USAID.
The GSP Subcommittee expects to carry out its next review of Bangladesh's progress on the GSP Action Plan in December, 2014.
When communicated, Labour Secretary Mikail Shipar said the government has met most of the conditions in line with the US Action Plan excepting a few.
Regarding recruitment of inspectors, he told the FE that a total of 67 inspectors have already been appointed while the barriers including up-gradation of the directorate to full-fledged department with creation of new posts, necessary changes in the recruitment rules of the DIFE and PSC have been removed to appoint the rest ones.
The second phase of government- led factory inspection will start shortly after resolving the disagreement between the local and western retailers appointed engineers, he added.
A draft law for the EPZs has already been formulated and would be finalised shortly, he added.
When asked, Shahidullah Azim, vice president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) said, "The government and the industry stakeholders are working but radical changes are not possible over night."
Regarding the harassments of labour activists, he admitted that there are some examples of such incidents but in all cases the allegations are not true. There are some other issues like land related issues, workers' personal conflict where the owners or the mid-level management have nothing to do.
"The important thing is that whether we have willingness to comply with all the requirements or not and we have," he said adding Bangladesh enjoys duty free benefit for a very negligible amount of export.
"It's a matter of prestige and that is why we want the GSP benefit back," the BGMEA leader said.
Both the government top official and BGMEA leader said the way Bangladesh is moving forward, they are hopeful about the restoration of the trade benefit in the US market 'unless the goal post is shifted by the US'.
In 2012, the total value of US imports from Bangladesh under GSP was $34.7 million and the top GSP imports from Bangladesh included tobacco, sports equipment, porcelain china, and plastic products.
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