Last week, the Obama administration decided to revoke special trade status for Bangladesh – effective in late August – because of lack of progress on textile-factory safety standards. Conditions in many textile factories are indeed abysmal – as the Rana Plaza building collapse in April so tragically illustrated when more than 1,100 people were killed. But revoking Bangladesh’s trade privileges will do more harm than good.
When I lived and worked in Dhaka some years ago, I often saw groups of women walking miles to their jobs in the textile factories. Most came first by bus from far-away villages, commuting two hours or more in each direction. They worked for very low wages, many of them in uncomfortable and unsafe environments.
Yet if you asked those women, they would tell you that those jobs paid for books and shoes so their children could go to school, and the jobs gave the women themselves new dignity and worth in their families and villages.
Labor advocates are understandably frustrated with the glacial pace of labor rights and worker safety reforms in Bangladesh. At a hearing of the Senate Foreign Relations Committee on June 6, a number of witnesses argued for revoking the special trade privileges Bangladesh now enjoys under the US Generalized System of Preferences, which aims to promote economic growth in the developing world. Yet withdrawing special trade status harms the very people labor advocates seek to help.
Although special trade status does not cover Bangladesh’s chief export to the US, textiles, it does give duty-free access to more than $30 million worth of goods produced by Bangladeshi workers, whose jobs will be in immediate jeopardy. But the real impact will be felt if the European Union follows the US lead and revokes Bangladesh's privileges, affecting exports worth more than 9 billion euros (almost $12 billion), representing literally millions of jobs.
The US decision could also persuade textile retailers, many of whom are debating whether to stay in Bangladesh, to pull out and source their ready-made garments elsewhere. Textile workers would then lose their jobs long before increased worker protections could be legislated and implemented. And once the jobs are gone, the political momentum that is now growing in Bangladesh for improved fire and safety standards could well dissipate.
Appealing as it is to take punitive action, the US cannot use Bangladesh’s trade privileges as leverage without disadvantaging hundreds of thousands of workers – and fostering instability in a moderate Muslim country whose only natural resource is its hard-working people.
For retailers it must be tempting to cease operations in Bangladesh and source textile products from less headline-prone countries. But that would send shock waves through the country’s economy, which is heavily dependent on the ready-made garments sector. The international retailers that have agreed to a fire and building safety pact announced in May have the right idea: Stay and make a difference as well as a profit.
The May pact commits participating retailers to conduct independent factory inspections and to pay for needed repairs and improvements. With the announcement of the safety pact, the international retailers framed the debate and challenged the manufacturers, the workers, and the government of Bangladesh to address the problems that led to the Rana Plaza collapse, the Tazreen factory fire last November, and other preventable tragedies in recent years.
They generated momentum for overdue changes to safety standards, provided resources to make immediate renovations, and bolstered economic confidence by committing to a long-term partnership with Bangladesh. Now US retailers, who did not sign on to the May pact, are apparently close to an agreement to improve textile-factory safety in Bangladesh.
But the retailers alone cannot make factories safe and prevent the next tragedy. Nor can outside governments, even the United States. The ultimate responsibility for ensuring that textile exports continue to fuel Bangladesh’s development rests with the Bangladeshis themselves.
Even 10 years ago not all textile factories in Bangladesh were unsafe and unsanitary places to work. I visited factories that met construction and safety standards, with well-lit, well-ventilated workspaces and adequate restrooms. Bangladeshi stakeholders can restore the image of the “made in Bangladesh” label with a three-pronged initiative.
First, reputable Bangladeshi textile firms, represented by the Bangladesh Garment Manufacturers and Exporters Association, need to set and enforce credible safety and workplace standards. They must press for legislation to beef up government inspection services and start outing and expelling fly-by-night textile companies that flout association and national standards.
Second, the government, which has already announced plans to raise the minimum wage and improve labor conditions in the industry, should launch a broad initiative to bring Bangladesh into compliance with international workplace standards.
And third, the garment manufacturers association and the retailers should conduct a campaign to educate workers about safety standards and ensure “whistleblower” protections so that violations can be reported without reprisals. Factory workers should have a role in ensuring their own safety.
There is ample precedent for a homegrown solution to the factory-safety issue that is supported but not coerced by international actors. Bangladesh pioneered micro-finance, a system of small loans mostly to women that has changed lives in Bangladesh and in other developing countries.
And starting in the 1980s, a quiet family-planning revolution has taken place that has reduced the fertility rate in Bangladesh from 6.4 in 1980 to 2.2 in 2011. This remarkable achievement was the result of appropriate government policies, social consensus that included many Muslim clerics, and a cadre of women educating other women.
Pulling the plug on US trade privileges could create a chain reaction that would cost poor Bangladeshis their jobs without necessarily leading to better conditions for workers. At the same time, it could well undermine political stability and economic growth in this hopeful, fragile democracy.
A better option is strong US economic and political support for a Bangladeshi-led reform agenda – with timetables and benchmarks – around which other governments and international retailers could rally. Those women I used to see walking to work deserve a job and a safe workplace, not one or the other.
Mary Ann Peters was the US ambassador to Bangladesh from 2000 to 2003. The views expressed here are her own.