A STITCH IN TIME… Bangladesh textile firms left in lurch

UNDER U.S. INSISTENCE, one of the world's poorest nations got its underaged workers out of the factories and into schools. Now Bangladesh's apparel industry, which employs 1.5 million of the country's 133 million people, is in trouble: Exports have been eroded by the global economic downturn, the rise of China as a garment manufacturer and, most stingingly, changing U, S. trade policies.

Los Angeles Times
  DHAKA, Bangladesh - Three years ago, when Salma was 11, she worked in a Dhaka factory, from 8 a.m. to 5 p.m., six days a week. She was a runner, trimming thread and shuttling bundles of sewn cloth. She made $9 a month.
  Today, the soft-spoken teenager is learning to read and write. Her parents are unhappy that she isn't bringing home wages, but they let her attend school because her teacher promised to help her find work soon that pays more than she earned at the factory.
  "I hope to get a job making televisions," said Salma, sitting on the floor of a tidy, one-room schoolhouse where she and her classmates, a swarm of colorful saris and T-shirts, attended to their math workbooks.
  Salma's climb from child la laborer to dutiful student is a tribute to the Bangladesh  Garment  Manufacturers & Exporters Association, which pledged eight years ago to remove children younger than 14 from factory floors.
  Under the association's program, designed in 1995 at the urging of the United States, the apparel industry has all but wiped out child labor. What's more, garment makers have sent nearly 10,000 children who once toiled in their factories to school, a considerable accomplishment in a country in which 35 percent don't make it past primary grades.
  But to many people here, the program doesn't feel like much of a success.
  Although the garment industry satisfied U.S. demands for reform, the United States is buying fewer Clothes from Bangladesh, which depends on apparel exports for three-fourths of its vital foreign exchange dollars.
  What's more, the Bush administration this year added the predominantly Muslim country to its list of 34 nations whose citizens must navigate a rigorous visa-application process in a program aimed, at combating terrorism. That makes it difficult for businesspeople to visit customers and attend trade shows in the United States, the second-biggest buyer of Bangladeshi apparel after the European Union.
  Politicians and businesspeople in the South Asian nation are bewildered - or suspect the worst: that the U.S. foreign-policy establishment, focused on Iraq, Afghanistan and elsewhere, simply has forgotten about them.
  "On child labor, Bangladesh responded in a major way, it was not window dressing said Zuilfiquar Rahman, managing director of Greenland Garments Ltd., which recently invested $1.4 million in a factory that produces clothing for several large European companies.
  "In this case, we did get off our backsides and made things work, and I do not think it has been reciprocated."
  Bangladesh, a small country on the Bay of Bengal, one of the most densely- populated regions in the world, has been prone to disasters and always desperately poor with 34 percent of its population living below the poverty line.
  And now the apparel industry, which employs 1.5 million of the country's 133 million people, is in trouble: Exports have been eroded by the global economic downturn, the rise of China as a garment manufacturer and, most stingingly, changing U.S. trade policies.
  The United States buys about 40 percent of the $4.5 billion in apparel exported by Bangladesh, helping to turn the country into one of the world's largest producers of men's dress shirts and khaki pants.
  After the Sept. 11, 2001, terrorist attacks, U.S. retailers reduced their orders, and today they are paying 30 to 50 percent less for shirts, slacks and other items, as weak global demand has driven down prices. As a consequence, companies in Bangladesh have eliminated 300,000 jobs and closed 1,200 factories.
  But more then economic fundamentals are hurting Bangladeshi apparel firms. In 2002, the United States began giving special trade preferences to African, Andean and Caribbean apparel manufacturers. A U.S. company that buys a pair of slacks or a blouse from Bangladesh pays a tariff that is 8 percent to 30 percent higher than if it came from Uganda or Peru.
  The U.S. government says Bangladesh is such. a world-class apparel producer that it doesn't need special treatment. That's hardly solace to the leaders of a country in which at least 35 percent of adults are unemployed and the per-capita annual income of $370 is one of the lowest in the world.
  Like other developing countries, Bangladesh catapulted into the global economy on, the back of its cheap, plentiful labor force. During the 1980s, the apparel industry here ballooned as entrepreneurs turned dilapidated multistory buildings into sweatshops, many without ventilation or fire escapes. Workers, mostly young women and girls, migrated to the cities and toiled from dawn to nightfall. They earned a few pennies an hour, but that was more than they could make in the fields or cleaning house.
  By the mid-1990s, labor activists estimated that as many as 50,000 children were helping to sew clothes for U.S. retailers such as Wal-Mart Stores and Kmart Corp.
  Media exposes sparked the threat of a consumer boycott in the United States. Sen. Tom Harkin, D-Iowa, proposed prohibiting the import of any manufactured or mined goods made by children under age 15.
  Threatened with the loss of its second-largest market, the Bangladeshi garment association signed a landmark child-labor pact with the United Nations, international Labor Organization and UNICEF on July 4,1995. Not only would manufacturers stop employing children younger than 14, but the factories also would pay to have former child laborers educated. And parents would be given about $5 a month to offset the loss of a child's earnings.
  Critics of the pact call it a well-intentioned failure. They say many young former factory workers ended up in far more dangerous jobs, including prostitution, because their families survive on their wages.
  In Washington, government officials consider the child-labor project a model; the United States has helped establish similar programs in Pakistan's rug and soccer-ball industries. A Labor Department spokesman said Bangladeshi factory owners were pioneers in the global battle against child labor and should be "applauded for their efforts."
  But the United States never made any quid pro quo promises to Bangladesh, the spokesman said, adding that granting beneficial trade status is a "matter for Congress."
  Harkin said the opposite is true. A spokesman for the senator said it was up to the Bush administration to decide whether - and how - Bangladesh should be rewarded for the "great job" it has done in all but eliminating children from apparel-factory floors.
  Edward Gresser, director of trade and global markets at the Progressive Policy Institute in Washington, said the United States had inadvertently worsened the economic situation for Bangladesh and other Muslim countries by giving special trade benefits to non-Muslim countries.
  He warned that the effect would be "to enlarge an already daunting pool of unemployable urban young people in the Muslim world, those most likely to be vulnerable to appeals from religious fundamentalists and terrorist groups."
  U.S. officials say they are not ignoring Muslim economies, pointing to a free-trade pact the United States has with Jordan and a proposed agreement with Morocco.
  In the United States, the powerful domestic textile and apparel manufacturing lobby has fought hard to protect the dwindling U.S. manufacturing base, from low-cost imports. The American Textile Manufacturers Institute lobbied against proposals by American and foreign officials that allies in the U.S.led war on terrorism -- including Bangladesh, Pakistan and Turkey -- be given preferential access to U.S. apparel markets.
  "You shouldn't use the U.S. textile industry as a bargaining chip with Muslim countries," said Cass Johnson, a spokesman for the manufacturers group.
  Other industrialized countries have responded to Bangladesh's plight: Japan, Canada and Australia, recently joined the European Union in agreeing to provide, quota-free and duty-free access, with some restrictions for apparel products from the country.
  But Bangladeshis fear that any gains will be obliterated in 2005, when the United States and other importing countries are scheduled to eliminate all apparel quotas. Once imports from China and India are no longer restricted, the contest for the lucrative U.S. market will be all the more fierce.

Scary reality
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