Bangladesh still risks losing EU GSP benefits

Bangladesh is still at risk of losing the European Union's GSP as the latter has again warned about its readiness to launch the procedure for withdrawal of preferences in case of failure to produce sufficient results.

The European Union (EU) will decide on its next steps following the publication of the assessment report by the International Labour Organisation (ILO) by the next month on Bangladesh in line with its (ILO's) previous recommendations.

The EU's warning came in its latest report expressing its concerns over labor and the human rights situation in Bangladesh. It suggested further improvements in these areas to avert any untoward situation such as withdrawal of trade preferences.

The third biennial report on GSP (Generalised Scheme of Preferences) covering the period 2018-19 was published on February 12.

The report cited the case of Cambodia where the Commission launched the procedure for a temporary withdrawal of the GSP facility in February 2019.

The countries which are unwilling to address and engage on issues of concern are being scrutinized, it said, adding that through enhanced engagement, the EU intensified the dialogue with Bangladesh, Cambodia, and Myanmar to press for concrete actions and sustainable solutions to serious shortcomings in respecting fundamental human and labor rights.

According to the report, Bangladesh, considering only preferential imports, has become the EU's number one GSP partner, closely followed by India, Indonesia, Vietnam, and Pakistan.

In Bangladesh parts, the Commission has raised concerns regarding labor rights, in particular, freedom of association under the Sustainability Compact raised the alignment of the Bangladesh Labour Act and Export Processing Zone (EPZ) Act with fundamental ILO Conventions 87 and 98.

In 2019, Bangladesh was denoted as a serious case under ILO Convention 81 on labor inspection, the report said, adding that 575 posts for labor inspectorates are not being filled. In 2018, the number of inspectors even decreased from 345 to 320.

The EBA dialogue and the recent mission established that there were still difficulties in the registration process of trade unions and allegations of arrest, surveillance, violence, and intimidation of workers persist.

Serious legislative restrictions, such as existing minimum membership requirement, hamper the establishment of trade unions, it noted.

The minimum membership requirement was reduced in October 2018 from 30 percent to 20 percent of the workforce, but remains a major barrier to the formation of trade unions and does not go far enough to bring the country in compliance with the ILO rules.

Therefore, further efforts are necessary to fully address the concerns raised by the ILO supervisory mechanism, it added.

Specifically, Bangladesh has been asked to remove legal obstacles in the right to establish and organize trade unions, elect officers and carry out freely activities of a trade union; tackling violence and anti-union discrimination, making urgent progress on the full elimination of forced and child labor.

The EU also asked Bangladesh to address gaps in implementing occupational safety and health and fundamental, labor rights in practice through reinforcing the labor inspection's capacity, improving freedom of expression and civil society space, investigating cases of alleged torture, ill-treatment, extrajudicial killings and enforced disappearances.

It suggested ratifying the Convention on Enforced Disappearances, fully implementing the recommendations of the Human Rights Council Universal and Periodic Review and the conclusions by UN treaty monitoring bodies.

According to the report, the economic impact of EU tariff preferences under EBA Bangladesh remains by far the most important beneficiary of the EU's EBA arrangement. Exports from Bangladesh to the EU more than tripled between 2006 and 2018.

In 2018, figures showed that EBA exports from Bangladesh to the EU amounted to €17.4 billion and approximately €2 billion in duties were saved in Bangladesh on an annual basis, according to the report. When asked, labor secretary KM Ali Azam said they are yet to see the full report.

He, however, said the government has already sent a time-bound action plan to the EU detailing how they would address the concerns.

After the Rana Plaza building collapse, much improvement has been made, he said, admitting that still there is room for making further improvement.

When contacted, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Dr. Rubana Huq said, "This is not an expression of disappointment but to keep the issues relevant and alive so that the principles don't get lost."

The EU wants to keep the pressure on, she said, adding that recently they had constructive discussions at the EU Parliament and OECD (Organisation for Economic Cooperation and Development) and explained the progress.