Bangladesh's Really Terrible Unfair Trade Practices
BANGLADESH, with a per capita income of $150, is one of the world's poorest countries. The people of Bangladesh are annually visited by floods, cyclones, and typhoons of truly epic proportions - most recently a storm claiming 125,000 lives. Still, Bangladesh bravely fights on. Indeed, despite its financial woes, Bangladesh contributed to Operation Desert Storm by sending a small detachment of troops to the Persian Gulf. As Bangladesh struggles to survive, how do Americans thank them for their support and reward their steadfastness? Do we forgive their debts? Do we establish new businesses there? No. Corporate America and the protectionists have chosen to repay Bangladesh by attacking its fledgling economy with allegations of unfair trade practices, and threatening trade sanctions that would close US markets to certain exports.
At this point, even the most protectionist corporate, political, or economic observer must pause and wonder what export from Bangladesh could threaten or injure a US industry. Surely the US semiconductor, steel, and automobile industries can withstand competition from Bangladesh. No, the Bangladeshi are selling cheap rags in the US, and the vital area of our economy under siege from these "unfair practices" is the crucial "shop towel industry."
The US textile industry asserts that Bangladeshi manufacturers of "industrial wiping cloths," more commonly referred to as "shop towels," dump these products in the US markets. This petition to the US International Trade Commission was filed by Milliken & Co. Family-controlled, privately-held Milliken hired the large Washington, DC-based law firm of Wilmer, Cutler & Pickering to assert that the Bangladesh shop towel industry receives export subsidies from the Bangladesh government which materially injur e
the US market. Fortunately for Bangladesh, the US Department of Commerce has dismissed this claim, determining that the .02 percent export subsidy paid by Bangladesh to shop towel exporters is de minimus.
Unfortunately, the US International Trade Commission continues to investigate whether Bangladesh shop towels are dumped in the US. The allegedly dumped goods from Bangladesh in 1990 represent a mere $2.46 million. Milliken is estimated to have sales of over $2.5 billion annually.
Should Milliken and the multi-billion-dollar textile industry be threatened by Bangladesh's $2 million in shop towel sales? Milliken, the self-appointed team-leader in protecting the textile industry, earlier fought the same battle over shop towels - triumphantly repulsing the onslaught by the industrial giant, Pakistan.
The textile industry already has the protection of the Multi-Fiber agreement, which limits textile imports into the US. These textiles are produced in poor countries many of whom are faced with economic disaster. Textile sales often represent one-quarter of the manufacturing exports of less-developed countries. To ameliorate the economic harm caused by these quotas, the US provides foreign aid to replace the revenue these nations lose. In essence, the US is giving less developed countries international w
elfare to keep them from working. So much for the free market. It is time for the protectionists to stop using the trade laws to bludgeon manufacturers in less developed states. Milliken should quietly throw in the towel.