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GSP cancellation cruel: US Heritage Foundation

  • Published at 02:20 am July 14th, 2013
GSP cancellation cruel: US Heritage Foundation

The cancellation of GSP facility will not help Bangladesh’s poor people and will have little impact on workers’ rights, according to a report by the US-based conservative think tank, the Heritage Foundation.

“The Administration’s punitive move is ineffective and cruel,” said the foundation’s Director Terry Miller and Research Associate Ryan Olson, in the report titled: “Punitive Trade Sanctions on Bangladesh, Not the Way to Improve Labour Conditions,” published last week.

It suggested that the Obama administration could help workers in Bangladesh more if it “cut tariffs on textile imports into the US.”

In response to poor labour conditions in Bangladesh, the Obama administration moved to unilaterally impose a suspension of trade access benefits.  This decision followed two prominent workplace tragedies that killed over 1,200 Bangladeshi workers in the last eight months.

In the US, the GSP programme provides 171 countries with duty-free access in 5,000 product categories.

“In 2012, Bangladesh exported over $4bn in textile and apparel products to the US, paying an average duty of nearly 16% on those products. Reducing or eliminating this duty would directly benefit workers in Bangladesh by increasing employment and encouraging economic growth,” the Heritage Foundation report said.

The GSP promotes growth and employment in developing countries and provides low-cost, duty-free goods for US consumers, the report said.

The US administration under President Barack Obama suspended the GSP facility for Bangladesh on June 28, in the wake of the Rana Plaza collapse at Savar, which claimed 1,131 lives. Unless the US Congress intervenes, the policy will take effect 60 days after the announcement.

These punitive actions would only hurt the poorest Bangladeshis and are bound to further depress employment in a country that is already suffering, the report said.

It urged Congress to act immediately to provide duty-free treatment under the GSP for developing countries.

The report argued that Obama’s move to punish Bangladesh by suspending GSP facility is misplaced.

“Instead, if the president truly wants to improve the lives and well-being of workers, he should encourage free trade, work to lower barriers, and increase economic dialogue with Bangladeshi authorities,” the report said.