Its Press Office Director says the US will work with Bangladesh on the steps needed to restore the GSP facility.
“The United States believes this moment represents an opportunity for Bangladesh to take action to improve labour condition and safety standards,” Patrick Ventrell said at a press conference in Washington on Friday (local time).
Bangladesh has been enjoying Generalised System of Preferences (GSP) Bangladesh in the US market though not for its ready-made garments . The GSP was suspended on Jun 27.
Workers’ platforms in Bangladesh have criticised the move saying it will not help their economy which is picking up.
Bangladesh government has described the decision ‘unfortunate’ and hoped Washington would consider reviving the facility soon.
Analysts say the move will be a major blow to Bangladesh if it influences the European Union into taking a similar decision, because the EU takes in the bulk of Bangladesh's ready made garments which is the country's major export.
The 27-nation bloc has been repeatedly threatening to revoke GSP facility if working conditions were not improved in the factories.
The EU buys more than $12 billion-Bangladeshi garments annually, roughly three-fifths of the country’s production.
The US decision comes against the backdrop of last year’s fire at Tazreen Fashions Limited wherein over 110 workers were killed and the April collapse of Rana Plaza near Dhaka leaving over 1,100 dead, mostly ready-made garments workers.
The US decision, however, will have little direct impact on Bangladesh’s multi-billion dollar ready-made garment export as the item was not included under the GSP. Bangladesh is the second largest exporter of ready-made garment products after China.
The US is the single largest importer of Bangladeshi goods. According to the Export Promotion Bureau (EPB), the total exports during 2011-12 fiscal were $24 billion. Exports to the US accounted for around $5.1 billion, about 21 percent of the country’s total export. Out of this, share of apparel export was worth $4.53 billion.
According to the US Trade Representative, Bangladeshi businessmen earned $34.7 million by exporting tobacco, sports equipment, porcelain china and plastic products to the US and duties waived amounted $2 million.
“We want to see the Bangladeshi economy succeed,” Ventrell said asserting the GSP cancellation was but an ‘opportunity’ for the South Asian nation.