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The pressure is growing on Bangladesh.
This story first appeared in the May 13, 2013 issue of WWD. Subscribe Today.
As the Bangladesh government said it would begin talks about a wage increase in its core textiles and apparel sector, the Obama administration is beginning to take an active role in dealing with the collapse of the Rana Plaza building that now has claimed 1,126 lives.
Two separate delegations of Bangladeshi government officials plan to meet with Secretary of State John Kerry, Rep. Sander Levin (D., Mich.) and key Obama administration officials in Washington this week to respond to the outcry over the tragedy.
RELATED STORY: Reform Calls Mount After Another Bangladesh Tragedy >>
The delegations are coming to lobby the U.S. government to maintain duty-free benefits through the Generalized System of Preferences, which are in jeopardy because of the recent tragedies.
In the wake of one of the worst industrial tragedies in history, Bangladeshi Foreign Minister Dipu Moni will lead a delegation with Saifuzzaman Chowdhury, a member of Parliament, that is slated to meet with Levin on Thursday and Kerry on Friday, according to Shafiqul Islam, counselor of commerce for the Bangladesh Embassy in Washington.
He said Moni also plans to deliver a speech on Thursday at the American Enterprise Institute.
A second delegation led by Shahidul Haque, Bangladesh’s foreign secretary, and labor secretary Michael Shipper, as well as officials from the Ministry of Foreign Affairs and the Ministry of Commerce, plan to meet with two State Department officials — Assistant Secretary of State for South and Central Asian Affairs Robert O. Blake Jr. and Special Representative for International Labor Affairs Barbara Shailor — at the State Department on Tuesday. The delegation also seeks to meet with officials from the U.S. Trade Representative’s office and Department of Labor on Wednesday, Islam said.
The focus will be on compliance issues related to the garment sector in Bangladesh, including building safety, and the steps the government is taking in the wake of the building collapse and the fire in November at Tazreen Fashions Ltd. in Dhaka that killed 112 workers.
“The whole nation is shocked,” Islam told WWD. “It has been more than two weeks [since the Rana Plaza collapse] and everyone is talking about it. So much action has already been taken. The culprits have been arrested. We have a morally good law, but there have been some gaps in enforcement. But now we are going to follow a zero tolerance policy.”
The USTR office is reviewing whether to consider withdrawal, suspension or limitation of duty-free benefits to Bangladesh under the GSP program. The U.S. program does not provide duty-free benefits for apparel, Bangladesh’s largest export, but the country’s preferences are in jeopardy because of the repeated tragedies in the nation’s garment industry.
As the Bangladeshi officials plan to make their case in Washington, U.S. officials are also focused on continuing discussions with retailers and apparel brands.
Kim Glas, deputy assistant secretary for textiles and apparel at the Commerce Department, said Friday that she plans to talk with U.S. buyers of Bangladesh apparel this week, following a call convened by the State Department, USTR and U.S. Department of Labor on Wednesday with U.S. retailers and brands.
“Just late (Thursday), some buyers reached out to me to ask to brief me on all their follow up since these tragedies and we plan on talking early next week,” Glas said.
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A USTR official said, “USTR is working with other U.S. agencies to engage the government of Bangladesh on the need for progress on labor rights and working conditions in Bangladesh. Part of this effort involves working with U.S. brands and retailers to encourage them to engage the government of Bangladesh and to coordinate public and private sector efforts on this crucial matter.”
“The U.S. actively engages with the highest levels of the government of Bangladesh, exporters and buyers on the issues of respect for workers’ rights and safe working conditions,” a State Department spokeswoman said in an e-mail to WWD. “Ambassador [Dan] Mozena regularly engages with the Bangladesh Garment Manufacturers and Exporters Association and has pressed the export association to launch a serious building inspections effort following the Rana Plaza building collapse. We also have an ongoing dialogue, at the assistant secretary level, with U.S. buyers that source from Bangladesh about workplace safety and the role that buyers can play strengthening respect for the rights of workers, including ensuring safe and healthy working conditions.”
She also said officials have urged Bangladeshi authorities to allow workers to exercise their right to freely associate and to allow organizations that seek to protect workers’ rights to operate freely. The State Department also supports a labor law amendment approved by Bangladesh’s cabinet that would allow the country “to improve respect for freedom of association.”
Officials said they urged retailers and brands on the call to coordinate their efforts with each other, as well as with the government of Bangladesh and the BGMEA, and civil and labor groups on factory safety and fire initiatives, including helping pay for independent safety and fire inspections. Administration officials also told U.S. companies to press their concerns about labor conditions with the Bangladeshi government and urge immediate passage of labor law amendments “to lay the basis for the establishment of the International Labour Organization and International Finance Corporation Better Work Program.”
Rep. George Miller (D., Calif.) and Levin have urged the White House to convene a major meeting between U.S. and European brands and retailers, as well as Bangladeshi garment owners and respective government officials, to develop an action plan to improve working conditions and avoid future catastrophes.
Jyrki Raina, chief of the IndustriALL Global Union, which is coordinating talks with international apparel brands and retailers to secure a binding accord on fire and building safety in Bangladeshi, said Friday, “A new final version of the agreement will be presented Monday after negotiations over the weekend with the leading brands — those that are the biggest in sourcing from Bangladesh.”
Raina said he was “absolutely” certain that a deal could be worked out because “there is such a pressure from politicians from the United States, from the European Union…and campaigns by different groups have collected more than 1 million signatures.”
Recognizing the growing international pressure for action to address working conditions in the country’s $20 billion textile and apparel sector, Bangladesh government officials said Sunday that a wage board was being constituted which would look at recommendations to increase the minimum wage for workers.
The minimum wage for workers went up in 2010, from 1,662.50 takas, or $21.36, to 3,000 takas, or $38.55. Garment workers were earlier demanding an increase to 5,000 takas, or $64.25, and last week the demands being made were more in the tune of 8,000 takas, or $102, as workers demanded better working conditions and safer work environments.
Textile Minister Abdul Latif Siddiqui said that the board would take ‘two to three months to make recommendations on new wages after discussing with stakeholders’ and that monetary compensation would go into effect as of May 1.
“This would certainly help the image of the country as we must not lose the brand investment in Bangladesh but the wages, compliance issues, power and raw material costs would completely change the cost of production,” an official who requested anonymity told WWD.
The government also has begun cracking down on unsafe factories. According to local press reports, after a meeting on social compliance issues on Sunday, the minister for commerce Ghulam Muhammed Quader said that as many as 943 ready-made garment factories are defective and risky.
Meanwhile, at Savar itself, the rain through Saturday night that stalled rescue work wasn’t quite enough to dampen the spirits of the rescue workers, who were back at their grim work on Sunday.
Still excited by having found Reshma Begum, a survivor in the rubble of the eight-story building that collapsed 17 days ago, they have been working with a new fervor, officials from the team said.
A total of 2,438 people have been rescued alive from the debris of the building that housed five garment factories, police officials said.
Despite the two days of shutdown called by opposition parties last week — with another due Tuesday — a 21-member Chinese delegation was on a visit to Dhaka to look at a stepped up manufacturing arrangement. “Bangladesh has the potential to export apparel products worth billions of dollars to China,” said Feng Dehu, vice president of the China National Garment Association (CNGA) who was leading the team.
Officials of the BGMEA said that they have signed a memorandum of understanding with CNGA to strengthen garment trade between the two countries. Garment exports from China are worth about $160 billion a year, while the domestic apparel market is worth $310 billion.
Many of the top echelon of the garment industry also came together for the funeral of Mahbubur Rahman, who was managing director of Tung Hai Sweater Ltd., and who died in the fire in his 11 story office building earlier this week. Seven other people were killed in the fire, which took place late at night after the workers had left for home. A BGMEA official told WWD that it was suspected to be an act of sabotage given the high compliance rating of the factory and the fact that it was unlikely to be caused by an electrical short circuit as has been the case in past fires, as the factory was not working at the time.
Meanwhile, the global brands that were sourcing from the companies in Rana Plaza have been under pressure from consumers and international organizations to compensate workers, and workers in Dhaka called for more compensation on Sunday.
Canadian brand Joe Fresh and U.K. brand Primark earlier said that they would compensate workers.
Primark on Friday noted that the company was “working on a comprehensive support package for workers affected by the disaster in Bangladesh” and would do so soon after the list of employees was established.
“The fate of all the employees in the entire complex has still not been confirmed and a list of employees has not yet been established because many records were destroyed when the building collapsed,” the company said.
“[Once] the company has a list of employees relating to its supplier, it will then be in a position to begin appropriate discussions on the practical implementation of this support,” the company continued.
“Food packages provided by Primark are continuing to be distributed to some 750 households on a weekly basis, rising to 1,000 households or more if necessary as soon as possible. This program will continue for as long as needed,” the company said.