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Jordan Apparel Exports to U.S. Fall

Jordan’s apparel sector, which is heavily dependent on U.S. exports, has lost ground in the post-quota era amid cases of abusive labor practices.

GENEVA — Jordan’s apparel sector, which is heavily dependent on U.S. exports, has lost ground in the post-quota era amid cases of abusive labor practices, a World Trade Organization report said.

This story first appeared in the November 18, 2008 issue of WWD.  Subscribe Today.

Violations in apparel factories that employ Asian migrant workers, who account for the bulk of the workforce in the country’s qualified industrial zones, or QIZs, has put the sector under close scrutiny.

In 2007, imports of textiles and apparel to the U.S. from Jordan declined 8.5 percent to $1.14 billion. From January through August of this year, they were down 13.2 percent to $788 million. Shipments from the QIZs accounted for $652 million, down 13.7 percent, according to WTO statistics. More than 90 percent of Jordan’s apparel exports are destined for the U.S.

In contrast with the apparel sector, Jordan’s minister of trade, Amer Al-Hadidi, told a WTO session examining the country’s trade regime that total exports grew 9.5 percent in 2007, and the economy expanded 6 percent. With rapid growth in the first half of this decade, textiles and apparel emerged as Jordan’s chief export, largely because of the QIZ initiative that allows companies located in these areas to export duty free and quota free to the U.S., the WTO said.

With global quotas limiting exports to the U.S., foreign apparel enterprises from China, Taiwan, India, South Korea, Pakistan, Sri Lanka and Turkey relocated and invested in Jordan to take advantage of the QIZ trade preferences. However, in recent years cases publicized by advocacy groups involving sweatshop conditions and forced labor have been uncovered at some of the more than 50 apparel factories in the QIZs.

The Jordanian government acknowledged the problem this year after reports and complaints from the U.S. State Department, the International Textile, Garment & Leather Workers Federation and the National Labor Committee. But the U.S. criticized the government’s response as “primarily…administrative penalties,” and noted that the “courts convicted three individuals for physical abuse of foreign workers in a factory and sentenced them to fines rather than sufficient prison sentences.”

In January, the government closed one factory after repeated violations for nonpayment of wages, overtime, physical abuse and poor living conditions. After the union demanded the government uphold the rights of 176 Vietnamese workers in a Taiwanese-owned factory, Jordan’s Ministry of Labor pledged to ensure migrants are given the same rights as Jordanian workers.

The labor clause in the 2001 U.S.-Jordan Free Trade Agreement stipulates adherence to internationally recognized labor rights, including the right of association, prohibition of forced or compulsory labor and acceptable conditions of work with respect of minimum wages and hours of work.

Asked about the problems in Jordan’s QIZs, a spokesman for U.S. Trade Representative Susan Schwab said Jordan has made “important progress” that includes “increased and improved labor inspections, which have resulted in unprecedented fines and even some factory closures. The government of Jordan has drafted appropriate measures and pledged to seek passage of additional reforms.”