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News Clips 12 April, 2013

[ Pakistan to get GSP Plus Status by year-end: EU ambassador ]
[ China to continue boosting spinning sector’s prospects ]
[ Wal-Mart funds supplier training after Bangladesh fire ]
[ Dhaka has to reply to 19 USTR queries on labour rights, safety ]

Pakistan to get GSP Plus Status by year-end: EU ambassador   [ top ]

DAILY TIMES, April 12, 2013
ISLAMABAD: Ambassador of the European Union to Pakistan Lars-Gunnar Wigemark on Thursday said that Pakistan would get the Generalized Scheme of Preferences (GSP) Plus Status by the end of this year, which will give a better market access of Pakistani products to EU markets.

Addressing at a dinner hosted by Islamabad Chamber of Commerce and Industry (ICCI) in honour of the EU ambassadors designated in Pakistan, he said that Pakistan and EU are enjoying deep-rooted political and economic relations as EU has supported Pakistan in a number of sectors.

A statement issued by ICCI said that Ambassador of Greece Petros Mavroidis, ambassadors of France, Austria, Czech Republic, Romania, Italy, Poland, Spain, UK Deputy Head of Mission and Swedish Deputy Head of Mission have also attended the dinner. Mavroidis said that Pakistan and Greece needed to improve their commercial and economic relations to promote bilateral trade and investment by taking advantage of new business opportunities.

Speaking on the occasion Ambassador of Romania Emilian Ion lauded the devoted efforts of ICCI head for strengthening bilateral relations between Pakistan and Romania. He said that business communities of Pakistan and Romania have to play a vital role for the promotion of bilateral trade and their greater mutual interaction is needed to achieve the ultimate objectives.

China to continue boosting spinning sector’s prospects   [ top ]

EXPRESS TRIBUNE, Farhan Zaheer, April 12, 2013
KARACHI: The prospects of the spinning industry – an important subsector of the textile industry – are expected to shine for at least another year. The good news came from China, which has decided to continue support cotton prices at home resulting in the continuation of yarn imports from regional countries including Pakistan.

The government’s support to the cotton prices in China made it very difficult for its spinning industry to continue manufacturing yarn, thus China is for the most part relying on yarn imports for the last few years. That is an ideal situation for Pakistan, which has surplus production of yarn.

“This is very good news for the spinning industry of Pakistan,” All Pakistan Textile Mills Association (Aptma) Vice Chairman Yasin Siddik told The Express Tribune, “This will definitely support the spinning industry of Pakistan.”

Textile companies have given new orders for expansion among them many are setting new units.

Aptma – textile sector’s lobbying group – recently said that the sector had borrowed Rs41 billion from banking sector in the last six months and invested in new machinery.

Of the total borrowing of Rs41 billion, the share of the spinning industry was Rs36 billion, according to Siddik, showing that the sector was already marching on the growth path.

In recent years, spinning mills have seen very good times mainly because of the sharp increases in yarn imports from China. The decision of Chinese government will result in more yarn exports to China and this will bring in some investments in spinning industry of Pakistan, said Bilal Alvi, analyst at AKD Securities.

The Chinese government said that it will continue to support cotton prices at the rate of $1.49 per pound (lb) for the next season. In this regard, procurement will start from September 1, 2013 and continue until March 31, 2014, with no cap on quantity to be procured at the support price.

China procured 6.15 million tons of cotton for the state cotton reserves during the September 2012 to March 2013 period, more than double if compared to the previous year.

On yarn exports and expansions at home, Ziad Bashir, Executive director, Gul Ahmed Textile Mills said, “Yes, yarn exporters will continue to grow, but it is difficult to say how many will go for expansions as it depends upon individual choices.”

Wal-Mart funds supplier training after Bangladesh fire   [ top ]

REUTERS, April 11, 2013
Wal-Mart Stores Inc, the world’s largest retailer, is making its biggest push yet to try to improve conditions at factories that produce its clothing after a fire at a Bangladesh factory last year killed 112 people.

The company also said Tuesday it would donate $1.6 million to help start a new Bangladesh training academy, and outlined its efforts to regain control over the complex and far-flung web of factories that make its products.

‘With the focus that is there at the moment on fire safety, everyone is keen to make sure that they get the right level of controls in place to protect the workers,’ Rajan Kamalanathan, Wal-Mart’s vice-president of ethical sourcing, said in an interview. ‘There is a need for that.’

Wal-Mart says it was unaware that its private-label clothing was being made at the Tazreen Fashions factory in Bangladesh, which went up in flames in November, killing 112 people and injuring at least 150. Bangladeshi authorities said the facility was not safe for use, and Wal-Mart said it had not authorised anyone to make its garments there.

The fire gave rise to criticism that Wal-Mart should have been more aware of its supply chain. Since the fire, Wal-Mart has been taking a harder look at what it can do to monitor safety at the low-cost factories that produce its goods.

While products for other companies, such as Sears Holdings Corp, were also being made at Tazreen, the biggest push for safety improvements has been on Wal-Mart.

Disney-branded products were also found in the remains of the factory following the fire, but Walt Disney Co said its records showed that none of its authorised licensees had manufactured Disney-branded products there.

Wal-Mart sent a 10-page letter to suppliers in January to lay out its policies. Since then, it has held meetings with them in Bentonville, Arkansas, where it is based; in Bangkok, and elsewhere.

The company has given its suppliers until April 15 to disclose which factories they work with, and says it will sever ties with those that subcontract work without telling Wal-Mart.

Along with the donation to the Institute for Sustainable Communities, Wal-Mart last month started to have Bureau Veritas, a European testing and inspection company, assess factories and train workers on its behalf in Bangladesh.

ISC plans to set up an Environmental, Health and Safety Academy in Bangladesh with the $1.6 million in funding from Wal-Mart and $2 million from Sida, the Swedish International Development Agency.

ISC plans to start training factory managers and workers in Bangladesh in August and is trying to line up more partners for the project, said Barbara McAndrew, ISC’s vice-president for institutional advancement.

It is still not clear how much companies would have to pay for the training, Wal-Mart and ISC said.

Dhaka has to reply to 19 USTR queries on labour rights, safety    [ top ]

FINANCIAL EXPRESS, Syful Islam, April 12, 2013
Bangladesh will have to make its position clear on, at least, 19 issues about labour rights and workplace safety in the apparel sector.

This will be required as part of the post-hearing briefs on the review of Generalised System of Preferences (GSP) by the United States Trade Representative (USTR), official sources said.

The post-hearing briefs will have to be submitted online by April 24 next.

The briefs will contain answers to the 19 queries, inclusive of those made by the USTR and the ones raised during the hearing session by the GSP sub-committee panellists.

A Bangladesh delegation, led by Commerce Secretary Mahbub Ahmed, appeared before the USTR on March 28 last over the workers' rights and their safety, following observations made by the American Federation of Labour and Congress of Industrial Organisations (AFL-CIO).

The USTR in the post-hearing briefs wants to know if the government of Bangladesh (GoB) has taken any action in the specific matters, raised by the AFL-CIO in its pre-hearing brief, including the incidents at Rebeka Fashions, Regency Garments and Southern Food Industries.

Officials said during the public hearing, the GoB sought time to confirm the number of trade unions registered in the past five years in the apparel sector.

The USTR now wants to know details about the registration of trade union bodies including their affiliations with other unions or federations.

It also wants to know whether the recent approvals of unions in the apparel sector have marked an improvement in terms of the rate of registrations and also about the state of checks and balances for the purpose of implementation to make sustained progress and measures being, or to be, taken to prevent a return to the relative difficulty that the unions experienced prior to this year in obtaining official registration.

It further wants to know about the protective measures are now in force to deal with cases about unfair labour practices and also about the names of agencies responsible for enforcing such measures. It has requested also for providing the number of unfair labour practice-related cases that were dealt with, through courts during the last five years.

It has also raised a question about the GoB's position on registration of a trade union, namely Bangladesh Centre for Worker Solidarity (BCWS). A case is pending before a court regarding de-registration of the BCWS.

Furthermore, the USTR wants to know the status of cases filed against BCWS officials, Kalpona Akhter and Babul Akhter, and whether the allegations made against them are based on facts.

It seeks to know about the outcome of investigations into the incident of murder of the labour leader, Aminul. One Mustafiz is a primary suspect in the case and he was allegedly in contact with the intelligence agencies.

Officials said the USTR also wants to know about the status of the mechanism by which Bangladesh Export Processing Zones Authority (BEPZA) can fund institutions and personnel for protecting the interests of the labourers.

Besides, it has raised a question about the authority and legal basis of prohibiting the workers of two apparel factories from returning to work after a mediated settlement reached with their employer in 2012. It has put questions whether BEPZA has the authority to share workers' identities with other factories in the zones to bar them from seeking future employment.

The USTR has made quarries about whether if the GoB has any plan for amending the EPZ Act, or otherwise and also about how it will meet the shortcomings of the provisions of the existing laws, as were highlighted by the AFL-CIO.

About fire safety it has raised questions about how many factories have recently been inspected, how much administrative fines or other kinds of sanctions, including closures, have imposed on the apparel factories for non-compliance with related standards and also about the nature and extent of violations of compliance-related issues.

The USTR wants to know the operational details of a 'hotline' established by the government for individuals to report anonymously fire safety hazards in apparel factories.

About the national action plan for ensuring fire safety, it seeks to know about the draft occupational safety and health legislation, the number of inspectors employed by the Department of Inspection for Factories and Establishment, the status of GoB's efforts to produce a unified fire safety checklist and the efforts made by the GoB to identify unregistered or unlicensed factories.

Further, it has sought GoB's proposal to improve the enforcement of labour laws in shrimp plants, the reasoning behind barring a non-government organisation (NGO), Social Activities for the Environment (SAFE), from carrying out its activities and the status of its registration with the NGO Affairs Bureau.

The USTR had earlier issued a notification on January 8, seeking public comments on the effects of possible withdrawal, suspension or limitation of GSP benefits on products imported by the US from Bangladesh.

On January 29 last, Bangladesh put forward its request to the USTR for continuation of the GSP facility in the US market, since the country has taken initiatives to upgrade the garment units' safety and ensure labour rights.

The GSP facility covers only 0.54 per cent of Bangladesh's exports to the USA, which was to the tune of US$ 26 million as against Bangladesh's aggregate exports worth $ 4.91 billion to the US market during the fiscal year (FY), 2011- 2012.