News Report The US embassy officials and Bangladesh officials firmly believe that Bangladesh is closer than ever to get back the GSP (generalized system of preference) facility but the diplomatic source feels that nothing will be happen before the next US presidential election. The next US presidential election is to take place in November 2016. The US main political parties – Democrat and Republican – are now busy selecting their presidential nominees. Former secretary of state Ms Hillary Clinton and Zeb Bush are two important aspirants seeking the support of the Democrats and the Republicans respectively. The diplomatic source also said US internal politics is very much involved with the restoration of the GSP. The US Trade Unions and the Textile lobby are very much against the restoration of the GSP. In fact, due to heavy pressure from both the groups the US administration has been forced to suspend the GSP raising the working conditions of the workers and safety issues in the RMG factories. The Obama administration is unlikely to take any decision about the restoration of the GSP fearing electoral setback of the Democrat presidential nominee, diplomatic source observed. It is learnt that the new administration in the US will enter the Oval Office after January 20, 2016. Thereafter the GSP issue may be placed for decision. If the Democrat wins in the presidential race, Bangladesh may be relatively sure about the restoration of the GSP. Meanwhile, the US brand and retailers platform – Alliance – looking into the safety issue of Bangladesh RMG factories identified 837 factories as vulnerable to fire and electrical safety and emphasised immediate steps for ensuring the safety from fire and electrical problems. It has been estimated that an amount of US$200 million fresh investment will be needed to implement the corrective measures to ensure relative safety from fire and electrical problems. The RMG owners seek government support in mobilizing such huge funds. At the request of the BGMEA the International Finance Corporation (IFC), a wing of the World Bank (WB), for financing the private sector, offered a credit to the tune of US$60 million. The Japan International Cooperation Agency (JICA) has offered Tk 100 crore. The Central Bank asked different commercial banks to offer loan to the RMG owners to the tune of Tk 10 million. Although fund is in place, the RMG owners are facing hurdle in enjoying fund facilities because of the rate of interest. The JICA will charge only 0.25 per cent interest, but the RMG owners will have to pay more than 10 per cent interest because of commission charge by the Central Bank and schedule banks for processing the loan portfolio. Similar situation also exists in case of utilizing the IFC fund. The BGMEA leaders urged the government to look into the matter of rate of interest so that the RMG owners may enjoy the fund facilities at an affordable single digit rate of interest.
