The apparel exporters said that the government was already taking measures to improve the $20 billion sector, therefore there was no “specific reason or logic’ behind the decision.
However, a former BGMEA chief said the door for talks on the issue was open since the government had recently approved the TICFA draft.
The US decision comes in the wake of a fire at Tazreen Fashions Limited that killed 110 workers and collapse of Rana Plaza that killed nearly 1200 people, mostly garment workers.
The US says Bangladesh industry must improve its working conditions and workplace safety to be able to avail the GSP facility again.
Some US senators had lobbied hard against the GSP facility to push Bangladesh garment industries to protect workers’ rights and safety.
After long hearings, in which Bangladesh officials also presented the country’s case, the US Trade Representative Michael Froman issued a statement on Thursday night (2:00am Bangladesh time) saying the GSP facility for Bangladesh should be suspended.
The US Generalised System of Preferences (GSP) accorded duty free access to 5000 Bangladesh-made products, though its main exports item, ready-made garment, is not included in the list.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Atiqul Islam was shocked by the US decision. “I can see no logical reason for this. We are not clear why it took such a decision.”
“GSP suspension was in gossip for a while,” he told bdnews24.com. “US says we need to improve working conditions. We did that. The government has amended Labour Act. We are also working on improving the lifestyle of workers. We have informed them (US) about it through various media.”
However, he was hopeful the decision would not dent the image of Bangladesh. “We might be under pressure in other markets. But exports will not go down.”
Knitwear units’ association BKMEA Vice President Mohammad Hatem said it was ‘unfair’ the manner in which the US had taken this decision.
“What they are saying about working conditions and labour standard is not right. We are working with the ILO (International Labour Organisation) to improve things,” he told bdnews24.com.
Hatem thought ‘politics’ might be a motivation for the decision. “The US has some political agenda with Bangladesh. The Obama administration cancelled GSP to pressurise the government to realise those political objectives.”
Though he did not specify what these agenda were, another business leader told bdnews24.com on condition of anonymity that the US was pushing the Bangladesh to punish the killers of workers’ leader Aminul Islam.
“They were also pressurising in other issues like Muhammad Yunus and giving entries to the Rohingyas. The US might have taken the decision considering all these.”
However, BKMEA Vice President Mohammad Hatem was also confident that the decision will not have adverse affect on the RMG market of Bangladesh. “The US has suspended GSP, but they did not stop orders. And on the other hand, buyers inspect working conditions themselves before ordering.”
Bangladesh exports the most products in the United States. Export Promotion Bureau says Bangladesh sold goods worth $24 billion abroad in 2012, 21 percent of which was in the US.
RMG owners say that the products which were exported to US under GSP were mostly from EPZs (export processing zones) where export is carried out by foreign investors.
Exporters Association of Bangladesh President Abdus Salam Murshedi told bdnews24.com that US was a big partner of Bangladesh. “We export $4.9 billion as single country there. Such a decision from them will land us in trouble.”
But Murshedi said the revocation would not cause a major problem if matters like workers’ new wage board, Labour Act amendment and improvement of working condition were expedited.
He also mentioned about the TICFA. “The government has to see whatever benefits can be obtained. The government has recently approved TICFA draft. The door for talks is still open. The government must hurry up.”