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EU considers Bangladesh action

Wednesday, May 01, 2013 - 02:50

May 1 - Some major western retailers, including Primark and Canada's Loblaw, have offered compensation to the victims of the Bangladesh factory collapse. Now the EU has voiced concerns over labour conditions and says it's considering trade action. Joanne Nicholson asks if the disaster will change retailers' behaviour, or shoppers' habits.

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Several thousand workers rallied in the Bangladeshi capital to mark Labour Day. They're demanding capital punishment for those they hold responsible for the deaths of more than 400 in Dhaka's Rana Plaza clothing factories. But on Europe's high streets, shoppers are still spending in the likes of Primark - one of the retailers whose clothes were made there. (SOUNDBITE) (English) UNIDENTIFIED PRIMARK SHOPPER SAYING: "...Hopefully they will do something about it, hopefully they will take responsibility. But unfortunately I have to shop where I can afford to shop at the moment so it is a double edged sword" (SOUNDBITE) (English) UNIDENTIFIED MAN, PRIMARK SHOPPER, IN THE STREET SAYING: "I can't afford to buy from other shops. That's why I am buying from Primark. But, you are right actually, because it is affecting sometimes, I think about it. It is affecting because, you know, it's a disaster. We are using third world countries just for our benefits" Duty-free agreements with EU markets and low wages have helped develop Bangladesh's $19 billion a year industry. Bangladesh has one of the largest garment manufacturing industries in the world. It makes up around 80 percent of the country's annual exports and much of that makes its way into Europe's shops. Now the European Union's considering trade action against the country to pressure the authorities to improve safety standards. But the EU would need the agreement of all member states and that could take more than a year. Germany is the main EU market at $3.4 billion, followed by the UK at $2.13 billion. Spain and France follow closely behind. Many now are questioning what the incentives are for improvements in the industry. Alongside Primark, retailer Bonmarche which has over 200 stores in the UK, says its products were made in the building, while Spanish chain Mango has said it planned to obtain samples from a supplier in the complex. Italian giant Benetton admitted a link with one of the firms in the building, although it says this was a one-off order. Bryan Roberts is a strategist at Kantar Retail. SOUNDBITE (English) BRYAN ROBERTS, KANTAR RETAIL, SAYING: "A lot of these big retailers are listed companies, they are answerable to their shareholders and it's their duty to maximize profits, and a number of the big retailers have said that for them to take on the role of monitoring and of auditing factories, of upholding regulations, would be hideously expensive, would lead to lower profits and more importantly, higher prices for consumers." Canadian company Loblaw, Ireland's Primark and the UK's Matalan have already offered compensation to the victims' families. And around 45 companies, including Gap, H&M, and Wal-Mart have met with the Bangladesh Garment Manufacturers and Exporters Association to discuss worker and plant safety. But as times remain tough in developed economies, shoppers show no signs of turning away from cheaper clothes.

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EU considers Bangladesh action

Wednesday, May 01, 2013 - 02:50