BD to raise objection to US over lifting of GSP facilities on sleeping bags
Wednesday, 4 January 2012
Badrul Ahsan
Bangladesh will raise objection to the US government's withdrawal of GSP facilities on Bangladesh made sleeping bags, a top official of the government said.
"We will protest the decision through the embassy of the United States (US) in Dhaka after making assessment on the impact of the decision," Commerce Secretary Ghulam Hussain told the FE Sunday.
Mr Hussain expressing his dismay over the US decision, said that the country might lose a good chunk of business if the benefit does not continue.
"A good amount of foreign direct investment (FDI) to the sector might be hindered due to the decision," another high official of the commerce ministry said preferring anonymity.
"Following increasing demand of the item among international buyers, some eighty companies have listed themselves with the Board of Investment (BoI) and Bangladesh Export Processing Zones Authority (BEPZA) to produce such product. But investment on the item has now become uncertain," he added.
However, local manufacturers of sleeping bags have also expressed their deep concern over the US government's recent decision.
Khadem Rasul Bhuiyan, Director of Chittagong-based Northpole BD Ltd said, "Withdrawal of GSP facility by the US government might leave a large number of workers jobless."
"The local manufacturers will now have to compete with China, a strong player of the segment which would not be so easy for the Bangladeshi players. Northpole exports sleeping bags worth $5 million a year," he added.
"So, Bangladesh might lose a big chunk of business for the cancellation of the GSP facility on export of sleeping bags," he said.
"Following efforts for a long time, we have developed required number of manpower and technology for the rising sector which has now fallen into a deep crisis," Rasul added.
Sleeping bags were among few items that enjoyed duty-free access to US since 2010, when the world's biggest economy introduced Generalised System of Preference (GSP) for LDCs on import of a number of selected items.
The decision to exclude Bangladesh-made sleeping bags from the list was announced on December 29, 2011 as President Barack Obama ordered de-listing the item as 'import-sensitive.'
The Obama administration has cancelled the GSP facility on import of sleeping bags from Bangladesh to US on complaints from US-based Exxel Outdoors, a sleeping bag maker.
The issue of lifting the GSP facility from the Bangladeshi sleeping bags at first came to focus when Senator Jeff Sessions of Alabama lodged an objection in December 2010 demanding a ban on the duty-free import of sleeping bags.
But the Obama administration then allowed the duty-free facility for sleeping bags from Bangladesh in the renewed GSP scheme on September 22, 2011.
Later on Sessions argued that sleeping bags should be subject to tariff, like other textiles, because the item competes with American manufacturers and the highest authority of US finally agreed to the argument.
The US instituted the GSP in 1976 by the Trade Act of 1974. Congressional authorisation of the GSP programme expired in December, 2010.
Bangladesh will raise objection to the US government's withdrawal of GSP facilities on Bangladesh made sleeping bags, a top official of the government said.
"We will protest the decision through the embassy of the United States (US) in Dhaka after making assessment on the impact of the decision," Commerce Secretary Ghulam Hussain told the FE Sunday.
Mr Hussain expressing his dismay over the US decision, said that the country might lose a good chunk of business if the benefit does not continue.
"A good amount of foreign direct investment (FDI) to the sector might be hindered due to the decision," another high official of the commerce ministry said preferring anonymity.
"Following increasing demand of the item among international buyers, some eighty companies have listed themselves with the Board of Investment (BoI) and Bangladesh Export Processing Zones Authority (BEPZA) to produce such product. But investment on the item has now become uncertain," he added.
However, local manufacturers of sleeping bags have also expressed their deep concern over the US government's recent decision.
Khadem Rasul Bhuiyan, Director of Chittagong-based Northpole BD Ltd said, "Withdrawal of GSP facility by the US government might leave a large number of workers jobless."
"The local manufacturers will now have to compete with China, a strong player of the segment which would not be so easy for the Bangladeshi players. Northpole exports sleeping bags worth $5 million a year," he added.
"So, Bangladesh might lose a big chunk of business for the cancellation of the GSP facility on export of sleeping bags," he said.
"Following efforts for a long time, we have developed required number of manpower and technology for the rising sector which has now fallen into a deep crisis," Rasul added.
Sleeping bags were among few items that enjoyed duty-free access to US since 2010, when the world's biggest economy introduced Generalised System of Preference (GSP) for LDCs on import of a number of selected items.
The decision to exclude Bangladesh-made sleeping bags from the list was announced on December 29, 2011 as President Barack Obama ordered de-listing the item as 'import-sensitive.'
The Obama administration has cancelled the GSP facility on import of sleeping bags from Bangladesh to US on complaints from US-based Exxel Outdoors, a sleeping bag maker.
The issue of lifting the GSP facility from the Bangladeshi sleeping bags at first came to focus when Senator Jeff Sessions of Alabama lodged an objection in December 2010 demanding a ban on the duty-free import of sleeping bags.
But the Obama administration then allowed the duty-free facility for sleeping bags from Bangladesh in the renewed GSP scheme on September 22, 2011.
Later on Sessions argued that sleeping bags should be subject to tariff, like other textiles, because the item competes with American manufacturers and the highest authority of US finally agreed to the argument.
The US instituted the GSP in 1976 by the Trade Act of 1974. Congressional authorisation of the GSP programme expired in December, 2010.