Commerce Minister Tofail Ahmed alleged the US would not restore GSP for Bangladeshi products despite all conditions were met as the authorities, being motivated politically, revoked the trade facility.
“Even if we did more than meeting the outlined conditions, the facility won’t be given back as this was a political decision,” he told journalists in reply to questions yesterday.
“I don’t want to take any further initiative to get back the GSP in the US market,” announced Tofail who earlier held a views exchange with Darja Bavdaž Kuret, Slovenian envoy to India, who also deals with Bangladesh affairs.
Commerce minister said the GSP suspension didn’t hurt Bangladesh exports to the US as the garment products, the major items, were not under the facility.
He said while all other countries were coming up with trade facilities for Bangladesh as per the WTO decisions, the US was going opposite.
A USTR-led interagency review has concluded that Bangladesh has made progress over the last year to address many issues, including fire and building safety inspections in the ready-made garment sector.
“Further progress is needed, however, in areas such as unfair labor practices and implementing rules of the Labor Law before reinstatement of trade benefits under the GSP,” it adds.
Khondaker Golam Moazzem, additional research director of Centre for Policy Dialogue, said though there was no impact of GSP suspension, Bangladesh would face competition from other countries which got the trade facility renewed.
“To remain competitive in the global market and maintain the current growth, the exporters will have to come up with better prices by reducing production cost or lowering profit,” he told Dhaka Tribune.
He, however, said products of Bangladesh’s small-scale industries like ceramics and plastics would suffer from the GSP withdrawal as importers might change sourcing due to pricing challenge.
Khondaker Moazzem urged the government not to consider the GSP suspension as politically motivated rather focus on ensuring compliance in the industrial sector. He also suggested raising the issue in the TICFA meeting.
The US government has extended general system of preferences (GSP) for 122 countries, but Bangladesh has been left out of the list.
US President Barak Obama signed the Trade Preferences Extension Act 2015 on June 29 reauthorising the GSP programme until December 31, 2017.
The renewed trade facilities would be effective from July 29, 2015. The trade facilities under GSP expired in July 2013.
On June 27, 2013 the US suspended the GSP for Bangladesh asking the later to fix the issue of worker rights violation.
After the suspension, the US government outlined a 16-point Action Plan for restoration of trade facilities under GSP. The government claimed that it has fulfilled all the conditions as per the action plan.
Tofail criticised those trade union leaders, who are affiliated with foreign unions but are not working in any factory, for causing “extensive damage” to the country’s apparel industry.
He said they were concentrating on market and product diversification rather than sticking to some limited export destinations as prime minister had directed.
