The White House announced Thursday it will suspend the eligibility of Bangladesh for tariff benefits under the Generalized System of Preferences (GSP).
“Our GSP statute requires certain basic standards for worker rights and worker safety as a condition of eligibility. Over the past few years, the U.S. government has worked closely with the government of Bangladesh to encourage the reforms needed to meet those basic standards. Despite our close engagement and our clear, repeated expressions of concern, the U.S. government has not seen sufficient progress towards those reforms. The recent tragedies that needlessly took the lives of over 1,200 Bangladeshi garment factory workers have served to highlight some of the serious shortcomings in worker rights and workplace safety standards in Bangladesh,” said U.S. Trade Representative Michael Froman, in a statement.
“While taking this action today, the administration is also initiating new discussions with the government of Bangladesh regarding steps to improve the worker rights environment in Bangladesh so that GSP benefits can be restored and tragedies like the Rana Plaza building collapse and Tazreen Fashion factory fire can be prevented,” he added.
Congress created the GSP program in the 1974 Trade Act to help developing countries expand their economies by allowing certain goods to be imported to the United States duty-free. Under the GSP program, 127 beneficiary developing countries are eligible to export up to 5,000 types of products to the United States duty-free.
In 2012, the total value of imports that entered the United States duty-free under GSP was $19.9 billion, including $34.7 million from Bangladesh. Top GSP imports from Bangladesh in 2012 included tobacco, sports equipment, porcelain china, and plastic products. "The United States will continue to accept imports from Bangladesh following this decision; however, none will be eligible for duty-free treatment under GSP while Bangladesh’s benefits remain suspended," the Office of the U.S. Trade Representative said.
The suspension of Bangladesh’s GSP benefits, which becomes effective 60 days after the publication of the proclamation in the Federal Register
, follows a multi-year, interagency U.S. government review of Bangladesh’s compliance with statutory GSP eligibility criteria related to worker rights.
The U.S. government has provided assistance through the U.S. Agency for International Development and the Department of Labor for programs that support the strengthening of worker rights in Bangladesh.