The United States of America (USA) continued to collect higher tariffs on Bangladeshi products during import from this country. Last year, the US collected 2.5 per cent of its total tariff revenue against imports from Bangladesh.  Data available with the US International Trade Commission (USITC) showed that they earned some $824.30 million (82.43 crore) as tariffs while importing Bangladeshi products worth $5276.16 million (527.61 crore) or $5.276 billion in 2014. Total import tariffs collected by US Customs last year stood at $324.84 billion.    US imports equal to Bangladeshi exports — by this calculation, it is Bangladeshi exporters who are actually facing tariff peak on the US market. On an average, Bangladeshi products are facing 15.6 per cent tariff. At the same time, average tariff rates on imports from the United Kingdom (UK) and France are 0.92 per cent and 0.96 per cent respectively in the USA.  Bangladesh is paying highest amount of tariff among the least-developed countries (LDCs).   Dr Mostafa Abid Khan, acting chief executive officer of the Bangladesh Foreign Trade Institute (BFTI), termed the US practice ‘highly discriminatory’. “Main problem is the USA has imposed high tariff on low-end products and Bangladesh mostly export these kinds of products,’ he told The Financial Express (FE). For instance, products like clothes and shoes have to face 14.8 per cent and 12.7 per cent average tariffs while entering the US market against zero tariff on products like aircraft, furniture and toys and games. USITC data also show that tariff has increased following incremental exports of Bangladesh. But last year, total Bangladeshi exports to the USA declined slightly to $5.276 billion from $5.281 billion in 2013. The USA also scrapped GSP (generalised system of preferences) facility for Bangladesh in mid-2013. Thus, last year, there was no export under GSP scheme, although it covered only around 1.0 per cent of Bangladesh’s total exports. Analysis prepared by Progressive Economy, a Washington-based think-tank, revealed that 78 per cent of US imports from developing countries were duty-free. It also showed that 100 years ago, tariffs raised 30 per cent of US government revenue but now it came down to only 1.0 per cent.    The US is yet to provide duty-free market access to Bangladesh, along with Nepal and Cambodia. Only these 3 LDCs don’t get tariff-free market access to the world’s largest economy.   The US is denying full market access on the plea that the Hong Kong ministerial declaration of the World Trade Organisation (WTO) linked 100 per cent market access with “no later than the start of the implementation period” of the Doha-round trade talk. As the round is yet to complete, there is no binding to implement full market-access facility. Dr Abid, however, said that the WTO has finalised the Trade Facilitation Agreement (TFA) and it would be implemented in July this year. “This is the start of Doha Round implementation and now US has to provide tariff-free market access to Bangladesh.” The Bali Ministerial Declaration in December 2013 has asked developed-country members of the WTO to extend existing coverage of tariff-free market access, if not already covered 97 per cent of products originating from LDCs. Except the US, all the developed countries have already offered duty-free, quota-free market access to almost all the LDCs, including Bangladesh.

Global retailers will focus on safety standards and compliance in Bangladesh’s garment sector at the sourcing trend meeting in Hong Kong in mid-March.Rick Darling, executive director of government and public affairs of Li & Fung, the world’s largest supplier of clothes and toys to retailers, will present a keynote paper on these issues at the meeting on March 16, organisers said in a statement.SourceTrends is an annual event for apparel and footwear brands, manufacturers, retailers, agents and suppliers. This year, Bangladesh is on the radar for the Tazreen Fashions fire and Rana Plaza building collapse.American Apparel and Footwear Association, American Chamber of Commerce, Footwear Distributors and Retailers of America, SGS, Oeko-Tex, Business Social Compliance Initiative, Sustainable Fashion Business Consortium and Worldwide Responsible Accredited Production are organising the meeting.Every year, retailers, brands and manufacturers from all over the world attend the meeting to discuss updates on safety standards, compliance and future plans in apparel and footwear sectors.“Darling’s presentation will focus on compliance and the effect of the issues in Bangladesh over the last two years and their relevant impact on the industry,” according to the statement.Darling will discuss the progress reports of the Alliance, a North American garment factory inspection agency, and Accord, another platform of 190 retailers and brands for factory inspection.Darling will also shed light on how the brands and retailers can use the experiences of both Accord and Alliance on factory inspection globally.In his current position, Darling oversees Li & Fung’s government relations, public affairs and supply chain sustainability on the global industry and multi-stakeholder initiatives, such as improving worker safety in Bangladesh.A full-day event is planned with five panel discussions that address product testing regulations, US customs and supply chain traceability.Each panel will be comprised of speakers from retail or brand organisations, product testing or audit/inspection companies, along with leaders from international trade associations from the textiles, apparel and footwear industry.Ian Spaulding, senior adviser of Alliance for Bangladesh Worker Safety; Larry Brown, head of global sourcing compliance of Espirit; Kitty Man, senior product safety manager of VF Corporation; and Alex Thomas, vice president of supply chain and manufacturing at VF Corporation, will also speak.

Italian fashion brand Benetton is facing renewed pressure to contribute to a compensation fund for victims of the Bangladesh’s Rana Plaza factory disaster in which more than 1,100 people died, reports The Guardian. Almost 1 million (10 lakh) people have signed a petition on Avaaz, the campaigning site, calling on the Italian company to contribute $5 million into a fund backed by the International Labour Organisation, a UN agency. Two months before the second anniversary of the collapse of the Bangladeshi factory complex, where clothes were being made for Benetton and a number of other brands including Britain’s Primark, the fund remains $9 million short of the $30 million required to fully compensate victims and their families. So far 5,000 people — injured workers and families of the deceased — have received only 40 per cent of the money due to them. There is enough in the pot to ensure they get 70 per cent. ‘The current funding gap is achievable if all brands that produced clothing at Rana Plaza step up and take responsibility. Without a contribution from Benetton, families cannot rebuild their lives,’ said Deborah Lucchetti from the Campagna Abiti Puliti, the Italian affiliate of the Clean Clothes Campaign that recently joined forces with Avaaz to ramp up pressure on Benetton. Despite pressure from campaigners and even government ministers, Benetton has so far held back from contributing to the ILO-backed scheme. The company chose to back a separate victim support scheme led by BRAC, a Bangladeshi non-governmental organisation, saying wanted to move quickly to support those affected. A spokesman said: ‘Through the programme with BRAC we have helped 280 victims and their families in a meaningful and constructive way with their immediate medical needs and to start new businesses so they can work on rebuilding their lives.’ But critics say Benetton’s work with BRAC does not amount to formal compensation. Campaigners are also calling on retailers that have made only small donations to the fund, such as US chains Walmart and the Children’s Place, as well as the Bangladeshi Prime Minister’s Fund to contribute more to the compensation fund. The biggest contributor is Primark, which is has paid out a total of $12 million in support for victims, $8 million of which counted as part of the ILO-backed scheme. It began making payments directly to workers more than a year ago.

The ongoing factory assessment and its post-inspection monitoring under the joint initiative of Accord, Alliance and govt-ILO for ensuring workplace safety and labour standards in the country’s RMG sector are facing hurdles due to the current political deadlock, sources said. The engineering teams could not move to the factories over security concern, they added. The Accord has recently hired three engineering companies — Arup, Woosun, and Hughes — to conduct its initial assessment in 200 more garment factories that were added to its list after completion of its initial assessment in September last. Factories that were added by the signatory companies to the Accord’s factory list after August 15 last year remained outside initial inspection purview. “Due to current political unrest this programme is slower than planned,” said the EU based retailers’ initiative Accord in its monthly update adding that its engineers have reduced their schedule of initial inspection visits each week. According to factory feedback, around 20 per cent of safety issues in the Corrective Action Plans (CAPs) have been remediated, it added. “The Accord engineering team was not able to conduct follow-up inspections to verify this remediation last month due to the political unrest,” it noted. However, the Accord expected to restart a reduced schedule of follow-up inspections soon following recent information from the government relating to increased security measures. After its initial assessment, the Accord said it had found more than 80,000 safety hazards in its assessed garment factories. The Accord inspections have also identified more substantial safety requirements, such as installing fire doors and automated fire alarm systems, establishing fire exits from factory buildings, and strengthening columns in the buildings. On the other hand, Managing Director of Alliance, another initiative launched by the North American buyers, retailers and apparel companies, M Rabin said though its initial inspection in 649 factories including the newly listed ones had already been done, the post-monitoring programme is progressing slowly due to the ongoing political deadlock. “So far, post-inspection monitoring has been done in 63 factories,” he said expecting to do the same in 100 units this month with a probable improved political situation. Similarly, the flaws finding programme by the government-ILO (International Labour Organisation) joint initiative is also facing problems as the two companies appointed recently under the initiative also reduced their number of factory visits following the continuous blockade and hartals, sources involved with the process said. They expressed their fear that if such situation is prolonged further, it might not be possible to complete inspection within the extended deadline of April next. Under the joint programme, some 1,500 garment factories that remain outside the purview of Accord or Alliance inspection will be assessed. Bangladesh University of Engineering and Technology (BUET) assessed some 500 factories while the rest are expected to be assessed by TUV-SUD Bangladesh Pvt Ltd and Veritas Engineering and Consultant. The three initiatives were formed to ensure workplace safety in the country’s apparel industry for a period of five years following the Tazreen and the Rana Plaza tragedies that killed more than 1,200 workers.

Vietnam is likely to overtake Bangladesh in the global apparel export market share in next 10 years once the Trans Pacific Partnership (TPP) takes shape, according to a new study. The TPP is a proposed freed trade agreement, US-led trade pact involving 12 countries – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam that collectively account for 40% of the world GDP. It is currently under negotiation and is likely to take effect in 2015. According to a research report by Standard Chartered Bank released last month, the agreement is likely to benefit Vietnam’s apparel industry, while hurting South Asian competitors like Bangladesh and Sri Lanka. “Vietnam could overtake Bangladesh in global apparel export market share by 2024, raising its share to 11% from 4% currently. Bangladesh’s market share would increase only marginally in this scenario to 7% from current 5%, while Sri Lanka’s would decline from the current 1%.” On this basis, Vietnam would beat Bangladesh to become the second-biggest apparel supplier after China when its apparel exports swells to US$115bn, it said. “If no TPP deal is struck at all, Bangladesh and Vietnam are likely to stand neck-and-neck by 2024, each with an 8% apparel export market share.” The news has added additional pain to the local manufacturers who have already been counting heavy losses every day due to the non-stop transport blockade and frequent strikes since January 5 that paralyses Bangladesh. “It will bring disaster for the country’s apparel industry, the mainstay of the economy, once the TPP is done,” President of Bangladesh Garment Manufacturers and Exporters Association Atiqul Islam told the Dhaka Tribune yesterday “To save the industry, we have to deal with the issue very smartly and diplomatically. We have no time to wait … we need to act right at this moment,” he said. The BGMEA president sees that the current political unrest may lead the American buyers earlier than expected to divert orders in Vietnam for taking advantage of TPP. “The US buyers might start to build relationship with Vietnam exporters right now due to the current political upheaval,” he said.   According to StanChart researcher Radhika Kak, the TPP trade pact, expected to be signed in 2015, will have wide-ranging consequences for the global apparel industry. Irrespective of the fine print, the agreement is likely to benefit Vietnam’s apparel industry, while hurting South Asian competitors like Bangladesh and Sri Lanka, she said. The StanChart report, however, said a TPP agreement with stringent Rules of Origin (ROO) requirements would likely lead to limited immediate gains for Vietnam’s apparel manufacturers. “Rather, the benefits would accrue gradually as the domestic textile industry develops. A wave of foreign investment in Vietnam’s textile industry has already begun, ahead of a potential TPP deal.” The report suggested that Bangladesh and Sri Lanka need to take steps to protect their own apparel industries in the face of a potential TPP deal. In the near term, Bangladesh should focus on capturing more of China’s current market share in the EU. Compliance with global safety and labour norms could help it to achieve this, as it would ensure continued access to EU Generalised System of Preferences (GSP) privileges, even after it graduates from Least-Developed Country status, it said. “It should also work to regain US GSP privileges. In the long term, up-skilling of the labour force will be necessary for Bangladesh to move up the value chain.” Kak said the push for strict ROO requirements reflects the US government’s desire to protect its domestic textile industry from increased competition from non-TPP textile manufacturing countries. “While the agreement with stringent ROO would not provide immediate gains for Vietnam’s apparel manufacturers, benefits would gradually boost the domestic textile industry.” The report said Vietnam’s apparel industry has called for maximum flexibility via the “cut and sew rule” which would give apparel manufacturers the flexibility to source yarn and fabric from lower-cost destinations (including non-TPP countries), requiring only assembly of the final product to be done in the TPP country. Flexible ROO requirements would likely result in gains for Korea and Japan, the primary suppliers of textiles to Vietnam’s apparel industry while China and Hong Kong would likely see little impact, as they are big suppliers to all three countries (Vietnam, Bangladesh and Sri Lanka), it said. Asian suppliers such as India, Pakistan and Thailand, as well as some European countries, would be likely losers, as they are preferred suppliers to Bangladesh and Sri Lanka, it said.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) will observe a day-long hunger strike on February 14 protesting the current political unrest. It will urge government and opposition BNP  to find a solution to the deadlock immediately, BGMEA vice president Reaz Bin Mahmood said told Dhaka Tribune. Besides, the BGMEA will hold an Extraordinary General Meeting (EGM) tomorrow to finalise the details of the programme. The EGM will set agenda for the next course of action.  Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Bangladesh Textile Mills Association (BTMA) and other associations related to the sector will also attend the meeting.  A source of BGMEA said the body might decide to stop production at the factories until the crisis is over. He said the purpose of the move is to create  pressure on the government and BNP-led alliance to come to a consensus on the crisis. According to an estimate of the apex trade body FBCCI, the RMG sector has suffered a loss of Tk30,000 crore in one month since the start of non-stop blockade on January 6. Earlier, the BGMEA staged demonstration urging the political parties to end the crisis and ensure a business-friendly environment. At least 69 people were killed in the current spate of violence and over 580 vehicles were torched across the country. angladesh’s garment manufacturers and exporters yesterday said the industry is in a deep trouble again due to latest spate of political unrest. Earlier on January 28, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) organised a human chain in front of the BGMEA Bhaban in Dhaka. “The blockade that began on January 4 has already wiped off Tk4,50 crore of readymade garment sector,”

Inspection of all ready-made garment (RMG) factories and the rules regarding Bangladesh Labour Act and export processing zone (EPZ) law will be completed by April, a high official said.   “The inspection of RMG units and finalisation of the rules on Bangladesh Labour Act and export processing zone (EPZ) law will be completed by April,” Ministry of Commerce (MoC) Senior Secretary Hedayetullah Al Mamoon told the FE. He said this after a three plus five informal group meeting on sustainability compact in RMG sector with the envoys of the US, Canada and some countries of the European Union (EU) at the ministry conference room.   “We informed the envoys about various measures taken for development of the sector, including the workers hotline as well as the progress on recruitment of inspectors for RMG factories.” He said the envoys expressed their satisfaction over the progress, made so far by Bangladesh in the RMG and textiles sector. They also said Bangladesh is a good example for RMG in the world, as all the stakeholders, global brands and retailers, and international communities have effectively collaborated in sustaining and revamping the labour-intensive industry here. US Ambassador to Bangladesh Marcia Stephens Bloom Bernicat, Ambassador and Head of Delegation of EU Pierre Mayaudon, Canadian High Commissioner Benoit-Pierre Laramee, Danish Ambassador Hanne Fugl Eskjaer, the Netherlands Ambassador Gerben Sjoerd de Jong, Ministry of Foreign Affairs Senior Secretary Md Shahidul Hoq, and Ministry of Labour and Employment Secretary Mekyle Shipar, among others, were present in the meeting.

The government is expected to select a number of engineering firms to conduct detailed engineering analysis (DEA) of readymade garment factories that have already been and are to be assessed under the National Tripartite Plan of Action, officials said. In this connection, the Department of Inspection for Factories and Establishments (DIFE) will seek applications from the interested firms through advertisement next week, they added. “The first meeting of the taskforce held last week decided to nominate some engineering firms that have expertise to carry out DEA,” Syed Ahmed Inspector General of DIFE told the FE. Earlier, the National Tripartite Committee under the Labour Ministry on December 23 last, formed two taskforces to oversee the post-inspection activities, including hiring of consultancy firms to conduct DEA, approve corrective action plan (CAP) and monitor its implementation of ongoing garment factory assessment under the government and the International Labour Organisation (ILO) joint initiative. Mr Ahmed, also head of both the taskforces, said an engineering firm must have at least three years of relevant experience and also is to be enlisted with the RAJUK. The company also must have two structural engineers with experience of 15 years, he said adding that none having below five years of experience would be considered. After scrutinising documents, the names of the selected consulting firms will be announced, he said.  “The list will also be sent to the two apparel apex bodies-BGMEA and BKMEA,” he added.  An official review panel, headed by the DIFE inspector general, was formed in 2013 to decide on shutdown of any garment factory, if found risky or non-compliant during inspection by any of the three initiatives – Accord, Alliance and government-ILO joint programme. The panel got recommendation of reviewing some 41 buildings that accommodated 84 garment factories from the three parties during their assessment last year. Finding risky, the panel announced immediate shutdown of 32 factories, while 21 units were partially closed, and 49 were asked to conduct DEA, DIFE sources said. Out of 49 factories, only five had conducted DEA while 30 units are conducting it now. The rest 14 are yet to take any step despite frequent reminders. The factories were asked to start DEA immediately (within six weeks) after visit of the review panel, they added. Professor Mehedi Ahmed Ansari of the BUET said DEA was recommended when owners or manufacturers of garments in a building failed to provide its drawing and design documents. It is time-consuming to know a building’s present situation, all the testing, including soil test, depth of building foundation, scanning of rod and columns and core test etc. There are some more factories with amber marking that are yet to take any move to conduct DEA as recommended by the BUET, he said. The BUET has asked about 100 factories for conducting DEA out of its 500 assessed units. However, Md Shahidullah Azim, vice president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) opposed the government’s move to select engineering firms. He suggested that there must be some criteria for carrying out DEA for the sake of transparency without mentioning any names of engineering firms.

Japan has agreed on principle to further relax the rules of origin for allowing Bangladeshi knitwear products to enter its market and decided to provide official development assistance to build a separate railway bridge on the river Jamuna. This was disclosed by Foreign Secretary M Shahidul Haque at a briefing at the Ministry of Foreign Affairs on Friday saying it as big achievement for the government.  “Japan has agreed to relax the rules of origin for Bangladesh on principle while the modalities and other formalities in this regard are being worked out,” Foreign Secretary M Shahidul Haque told reporters at the ministry. He came up with the decision after the first-ever Foreign Office Consultations (FOC) between Bangladesh and Japan held at the Foreign Ministry. Earlier, Prime Minister Sheikh Hasina during her last visit to Tokyo requested her Japanese counterpart Shinzo Abe to relax the rules of origin, said the Foreign Secretary. Japan has not been giving  GSP benefit on certain knitwear products to Bangladesh as the country  needs to buy fabrics for those high quality products from outside. “Further relaxation in the rules of origin will ensure duty-free access to Japanese market,” he said adding that Bangladesh exports knitwear goods worth $500 million annually to Japan and it may rise. The foreign secretary said Japan expressed satisfaction over the progress of setting up a special economic zone for the Japanese investors. “You know the issue was finalised on Thursday.” Foreign Secretary M Shahidul Islam and Japanese Deputy Foreign Minister Shinsuke Sugiyama led Bangladesh and Japan sides respectively at the FOC which reviewed the entire gamut of bilateral relations. Trade and investment issues were discussed in the meeting apart from reviewing the progress and agreed projects. “Both sides expressed satisfaction over the progress. The progress is virtually good,” the foreign secretary said. The Japanese side made it clear that they want to help Bangladesh for its industrialisation through massive investment, he said. Concerning the five mega infrastructure projects that were identified by the two Prime Ministers, the Japanese side informed that they have already made a preliminary decision to provide ODA for the project of building a dedicated rail bridge over Jamuna paralleled to the Bangabandhu Bridge. For other four projects, namely Ganges Barrage, multimodal tunnel under Jamuna, Dhaka Eastern Bypass; and ecological restoration of four rivers around Dhaka, two sides are discussing on the modalities. “Tokyo reaffirms its commitment to further strengthen its bilateral relationship with Bangladesh based on the “Comprehensive Partnership” agreed upon between the two Prime Ministers last year,”,said Shinsuke Sugiyama. The Japanese side thanked the Bangladesh government for withdrawing its candidature for the non-permanent seat at the UN Security Council in favour of Japan demonstrating the high importance Bangladesh attaches to its relations with Japan. Bangladesh appreciated Japan’s decision of increasing the number of JDS scholarships for Bangladeshi students at 25 from 15.

Relatives of garment workers who died in the Rana Plaza collapse and Tazreen Fashions fire and the injured workers formed a human chain beside the Dhaka-Aricha highway at Savar bus stand yesterday, demanding compensation. The demonstrators formed the human chain under the banners “Rana Plaza Garment Workers’ Union” and “Tazreen Fashions Garment Workers’ Union”. Nasima Akter, a victim of Tazreen Fashions fire, said it has been over two years since the fire occurred but she is yet to be compensated. “We cannot pay for food much less other necessities after losing our source of income,” she said breaking down in tears. She added that they are living inhuman lives.     Jorina Akter, president of Tazreen Fashions Garment Workers’ Union and a victim herself, said the victims need compensation immediately. “Families of those who died are living very miserable lives after losing their breadwinners, and those who were injured cannot work anymore,” she said. The government and BGMEA are wasting time so that the matter can be closed but the people will never forget what happened, said Emdadul Islam, president of Rana Plaza Garment Workers’ Union.     “If the workers take to the street it will be problematic for the government. To be compensated is our right,” he said. On November 24, 2012, a fire broke out at Tazreen Fashions, a garment factory in Ashulia, and killed 111 workers and injured many more.      On the other hand, Rana Plaza, which housed five garment factories, collapsed on April 24, 2013 killing 1,136 workers and injuring scores others.