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Mozena fears 'perfect storm' in garment sector

Star Business Report
US Ambassador Dan Mozena yesterday warned Bangladesh that restive developments in the garment sector could undercut apparel exports to the US market.
He called for efforts to resolve issues such as political instability, work environment and trial of the killer of labour activist Aminul Islam.
The recent political development and the incidents in the garment sector sent negative signals to major US buyers, Mozena said at a meeting with the leaders of Bangladesh Garment Manufacturers and Exporters Association on duty-free market access to the US market.
Mozena said he had received a call at almost midnight from the CEO of one of Bangladesh's biggest buyers who shared his increasing concern that “the tarnishing Bangladesh brand maybe putting his company's reputation atrisk".
Quoting the CEO, Mozena said his company would gladly pay more for a Bangladeshi product if it were'fairtrade'.
His company's reputation is worth more than saving a few cents per shirt bought from Bangladesh, Mozena added.
In another instance, he said, at a recent dinner in Dhaka, six buyers for major American brands took him aside and shared with him the increasing concerns coming out of their respective headquarters about what they see was happening in Bangladesh, as conveyed to the American public through negative stories in the media.
Bangladesh is a truly blessed country and has the chance to be the world's largesttextile articles exporter, he said.
But the chance depends on creating a political stability as major political parties should reach an early agreement on a mechanism for holding free, fair, credible and participatory elections, Mozena added.
The recent incidents in the garment sector could coalesce into a perfect storm that could threaten Bangladesh and the Bangladesh brand in America, which could drive away key American buyers of Bangladeshi RMG, he warned.
Mozena said Bangladeshi activists who monitor labour in the RMG sector tell him that workers are becoming increasingly 'restive', mainly due to the growing failure of wages to keep up with the rising cost of living and the increasing vulnerability labour leaders feel as a result of the murder of Aminul and harassment of other labour activists.
The murder of Aminul, a labour activist who was associated with the AFL-CIO affiliated, USG-supported Solidarity Centre here in Dhaka, has elicited little
attention or interest in Bangladesh. But that is not the case in the US, where labour rights supporters have seized on this issue, highlighting it as a major escalation in the erosion of labour rights in Bangladesh, Mozena said.
Several members of Congress have written to US Secretary of State Hillary Clinton to convey their concern about this case, hesaid.
“Secretary Clinton raised Aminul by name with the prime minister, foreign minister and leader of opposition; the secretary discussed the labour situation in Bangladesh in each of those meetings," he said, referring to Clinton's visit to Bangladesh.
Mozenamentioned apending petition by American Federation of Labour and Congress of Industrial Organisations (AFLCIO) to suspend Bangladesh's GSP (generalised system of preferences) rights. Although RMG products do not benefit directly from GSP, the suspension of these rights would send a negative message across America that Bangladesh is anti-labour, he said.
“That message would not be lost on RMGbuyers, norconsumers."
The signing of the US-Bangladesh Trade and Investment Cooperation Framework Agreement (TICEA) is not a precondition in getting duty-free access of Bangladeshi garments to the US market, he added.
TICEA is a quite simple and has only a single action item (the establishment of a forum to identify and seek to resolve obstacles to increasing bilateral trade and investment); it has now been dragging on for four years, he said.