Trade advocacy groups generally argue against trade-disrupting measures on the grounds that workers experience the brunt of the pain they cause.
Kimberly Elliott, a trade specialist at the Center for Global Development who has been following issues in Bangladesh, said the administration is taking the wrong tack if it wants to change the country’s behavior. She believes that offering tariff breaks to textiles — and the prospect of a boost in Bangladesh’s already massive exports to the United States — would be a more effective strategy. That move would be controversial, however, among U.S. textile companies and poor countries such as Haiti and Kenya, which benefit from U.S. trade preferences.
“It is pressure from buyers that is going to get Bangladesh to change,” she said. “This case has been dragging on for six years, and it took a building collapse and a thousand people dying for the U.S. government to get to this point. It is not clear to me that it sends that much of a signal.”
Another option would be to increase tariffs on textiles directly, a move that also would hurt the dozens of U.S. companies that rely on Bangladeshi garment factories for their production. The United States purchases about 25 percent of the country’s $18 billion in annual apparel exports.
U.S. retailers Wal-Mart and the Gap have resisted participating in an international, legally binding industry agreement to improve safety conditions in Bangladeshi factories signed last month by mostly European companies. Instead, they are close to committing to an initiative of their own.
The European Union, which imported about $12 billion of goods from Bangladesh last year, also is contemplating whether to suspend trade benefits for Bangladesh. Such a decision would have far more impact, because Bangladesh’s clothing and textiles exports receive duty-free treatment there.
However, Lilianne Ploumen, the Netherlands’ minister for foreign trade and development, said that it shouldn’t get to that point, because the authorities in Bangladesh will yield to the pressure. “I cannot imagine them not acting to address these issues,” she said.