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U.S. suspends Bangladesh’s trade status over poor labor conditions

Barack Obama

Barack Obama

The U.S. government decided to suspend the preferential trading status of Bangladesh on Thursday following a foreign relations hearing earlier this month on labor conditions in the country.

President Obama issued an order suspending Bangladesh’s duty-free trade privileges under the Generalized System of Preferences program, putting pressure on the country to improve workplace safety after a number of accidents, including the collapse of the Rana Plaza factory and the Tazreen Fashion fire — both of which led to a total of more than 1,200 deaths.

“It is long overdue for Bangladesh to reform its labor practices and ensure workers’ rights,” Sen. Robert Menendez (D-N.J.), the chairman of the Senate Foreign Relations Committee, said. “Bangladesh is an important trading partner, but we cannot and will not look the other way while workers are subjected to unsafe conditions and environments endangering their wellbeing…Bangladesh’s labor laws must be dramatically improved, and suspending GSP benefits will hopefully help kick-start these overdue reforms.”

Previously, Bangladesh was permitted to export nearly 5,000 duty-free products to the U.S., which comprise about 25 percent of the country’s $18 billion in annual apparel exports, Gulfnews.com reports.

The Bangladeshi government described the U.S. decision to suspend its GSP status as “unfortunate” and “harsh.”

“Indeed a section of people, inside both Bangladesh and the USA, had long been campaigning to this effect,” the Bangladeshi government said in an official statement, according to Gulfnews.com.

Though the statement did not name any particular individual as responsible for the so-called campaign, Bangladeshi Prime Minister Shaikh Hasina, as well as several members of her ruling Awami League, accused rival Khaleda Zia of the Bangladesh Nationalist Party of leading the campaign to suspend the country’s U.S. trading status.

Financial analysts, however, maintain that the move is unlikely to have a substantial effect on Bangladesh’s U.S. exports. because apparel is not covered as duty-free under the GSP, Gulfnews.com reports.

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