June 2013 Source concentrates on lessons from Bangladesh tragedies

The June Source is given over to lessons from the Bangladesh tragedies

Bangladesh building safety plans hit by confusion

Estimates of the state of Bangladesh factory buildings varied widely, with some respected surveyors claiming that
up to 60% of factory buildings are unsafe. Major buyers’ inspections provoked controversy, as other buyers
disputed some judgements, some factories disputed buyer’s findings and other factories accused Walmart of
deliberately libelling suppliers who had previously fired the retailer. Conflicting codes seem partly to blame
With no common ground about the scale of dangerous buildings, there is no serious estimate of how much
repairing or replacing them will cost. Plans to relocate many factories are stuck as land still has not been acquired
for a new factory zone – eight years after it was first announced. Fewer factories want to move than expected –
but they want twice as much space as is planned for them

Truth of “food poisoning” and “worker unrest” equally hard to establish

A number of near-simultaneous apparent food poisoning and water contamination incidents in Bangladesh were
claimed by activists to be further evidence of unsafe working conditions, by some factory owners to be the result
of deliberate poisoning and by doctors to be mass hysteria partly caused by dehydration, poor ventilation and poor
nutrition. Near-continuous violent disputes around Ashulia have apparently caused many buyers to shift
production elsewhere in the country, and encouraged a huge range of suggested causes: from simple criminality,
through legitimate worker grievance to conspiracies by mysterious foreigners or just opposition politicians.

Buyers pursue agreements as shopper concern evidence dubious

Buyers accounting for about 35% of Western European garment sales signed an Accord committing to helping
fund rectifying unsafe factories, accept worker involvement in planning and continuing to buy in Bangladesh.
Most US buyers declined, with spokesmen claiming to have an alternative plan. It later transpired they did not, but
knew why they dislike what Europeans signed and say they might have one by mid July. Walmart and Gap,
however, probably invested as least as much money and effort into Bangladesh factory safety as any European.
Though media described widespread public outrage over factory safety, our review of published research shows
no evidence of significant public preparedness to pay more for better working conditions. Some market research
seems to shows about 30% of North American shoppers just don’t want to buy anything made in Bangladesh

UK, US and Canadian investors call for signing. Australians say “quit”

US and UK shareholder groups sent letters to buyers implying continued shareholding requires greater buyer
attention to working conditions. A group of Canadian shareholders sent a similar letter, without the implied threat.
An Australian bank said it regarded continued use of Bangladesh factories as a risk. Outside the English-speaking
world, shareholders were silent.

Bangladesh exports grow, amid gloomy external predictions

Bangladesh’s garment exports since the November Tazreen fire have been growing at twice the growth rate they
enjoyed before, but many buyers and factory owners think they will start falling from about July. No-one but
Disney has announced it is leaving. Moody’s rating agency predicted the disasters would discourage foreign
investment – but more foreign garment and support businesses have opened in the past six months than for some
years. Businesses still report serious labour shortages, as a thriving labour broking industry arises.

Will wage rises and union rights dampen perpetual violence?

The Bangladesh government announced unions would be allowed, but most worker representatives attacked its
proposals as undemocratic. Many Bangladeshis, though agree with the government that politically motivated
activists need to be kept out of industrial relations. The government announced a wage review board, and
promised to backdate its


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