Bangladesh Pushed by U.S. to Protect Factory Workers

The Obama administration is pressing Bangladesh to do more to strengthen worker-safety standards as a condition for restoring U.S. trade preferences that were suspended after a deadly garment factory collapse in April.

The U.S. government yesterday made public the steps that the Bangladeshi government needs to take to win restoration of benefits on $34.7 million in goods from the Asian nation. Measures called for by the U.S. include increasing the number of labor, fire and building inspectors and creating hotlines for workers to anonymously report safety and rights violations.

“The administration is making this action plan public as a means to reinforce and support the efforts of all international stakeholders to promote improved worker rights and worker safety in Bangladesh,” according to a joint statement from the State and Labor departments and the U.S. Trade Representative.

President Barack Obama’s administration announced June 27 that it would halt the trade benefits, citing concerns that Bangladesh failed to adequately safeguard worker rights. The U.S. acted in response to the April 24 collapse of the Rana Plaza factory, the worst industrial accident in Bangladeshi history, which killed more than 1,110 workers and prompted increased scrutiny of the country’s labor conditions.

The measures recommended by the U.S. were submitted to Bangladesh at the time the preferences were halted. The steps also include creation of a database on garment factories with the results of fire, labor and building inspections, including violations reported and sanctions levied. The U.S. also called for improved training for inspectors in the Asian country.

Apparel Excluded

Bangladesh participates in a U.S. program known as the Generalized System of Preferences, which allows zero or reduced tariffs on some products imported from developing countries. The trade preferences exclude imports of Bangladesh’s apparel, which the U.S. Commerce Department said represented 91 percent of the $4.9 billion in U.S. imports from the nation last year.

Seventeen North American retailers, including Gap Inc. (GPS) and Wal-Mart Stores Inc. (WMT), announced a five-year plan last week aimed at improving factory safety in Bangladesh. The pact requires factories to be inspected within a year and results to be made public, and it includes setting up a $42 million fund to help its implementation, according to a July 10 statement from the companies.

The Alliance for Bangladesh Worker Safety said it will set safety standards by October and refuse to buy from factories deemed unsafe. The U.S. retailers’ pact has been faulted by worker-rights groups as falling short of a comparable agreement reached by mostly European retailers, which obligates companies to ensure their factories have the capital to make necessary repairs.

Under the North American pact, individual retailers can voluntarily pledge capital beyond the $42 million so factories can make safety renovations.

To contact the reporter on this story: Michael Shepard in Washington at mshepard7@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net

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