April 24, 2018 / 2:39 PM / in a month

COLUMN-Commentary: Five years after Rana Plaza, Bangladesh still needs $1.2 billion fix

(Paul Barrett is deputy director of ‎New York University’s Stern Center for Business and Human Rights. The opinions expressed here are his own.)

By Paul Barrett

April 24 (Reuters) - Five years ago this week, just after thousands of garment workers had settled in behind their sewing machines, a poorly built eight-story Bangladeshi factory complex called Rana Plaza buckled and collapsed. More than 1,130 people, mostly young women, died; 2,500 were injured.

In the years since the worst disaster ever in the apparel industry, Bangladesh has become a laboratory for testing factory safety. Western brands and retailers that source low-priced clothing there have inspected 2,300 active factories and pressured suppliers to make real improvements. Dozens of shoddily built facilities have closed altogether.

But the Bangladesh experiment has been only partially successful. The European and American companies limited their reach and left thousands of factories untouched. The Bangladeshi government, meanwhile, has demonstrated little willingness to change its lackadaisical attitude toward regulation. Millions of garment workers remain at risk, especially those working for subcontractors—small second- and third-tier factories often completely unknown to Western brands.

The turmoil in the wake of Rana Plaza constituted a public relations crisis for Western brands and retailers. Some 250 companies have formed a pair of initiatives: the European-dominated Accord on Fire and Building Safety in Bangladesh, whose leadership includes trade unions, and the American-led Alliance for Bangladesh Worker Safety. These groups inspect factories, oversee remediation of safety problems, and collectively cut off any suppliers that fail to comply.

Within their self-assigned jurisdictions — defined as the body of factories with which their members directly do business — the Accord and the Alliance have performed impressively. The Accord reports that 85 percent of the hazards its inspectors identified have been fixed. These include blocked exits, inadequate sprinkler systems, faulty electrical wiring, and unstable support pillars. The Alliance reports an 88 percent remediation rate.

Catastrophic accidents have declined in Bangladesh. In 2013, there were 17 accidents, including Rana Plaza, that resulted in five or more deaths and/or 10 injured workers. Each year from 2014 through 2017, this number has hovered between two and five such accidents, according to data analysis contained in a new report by the NYU Stern Center for Business and Human Rights.

But the mission of making factories safe in Bangladesh isn’t even close to done. The Accord and Alliance will not continue indefinitely. The Alliance plans to wrap up its work by the end of 2018. The Accord will renew its mandate every six months, but only through mid-2021. At some point, the factories that the two initiatives have overseen will return to the supervision of the Bangladeshi government, which is notorious for having ignored death traps like Rana Plaza and Tazreen Fashions, where a November 2012 fire killed 112.

Subcontractors present a big challenge. These smaller shops help “mother” factories handle sudden volume increases and changed orders. No one has an exact count of subcontractors, most of which operate with little or no regulation. While the NYU Stern Center estimates that there may be as many as 3,000 of these factories, the government denies a subcontracting system even exists.

But on a recent fact-finding trip, researchers from the NYU Stern Center visited two subcontracting factories of 150 and 200 workers each. They weren’t hard to find. At one, the owner told of receiving a list of fire-safety mandates from a government inspector. The owner said he’d lost the list and, in any event, didn’t have the money to install sprinklers or a fire alarm. He didn’t seem in the least concerned.

It’s vital that the Bangladeshi government recognize the presence of garment subcontractors — as well as its larger long-term duty to regulate the industry with vigor. In the short term, though, those with an interest in the country’s apparel business ought to band together and finance a task force devoted to finishing the work the Accord and Alliance have begun.

A “shared responsibility” task force could seek to address human rights challenges by means of the collective action of major stakeholders. Variations on the model have been used for years by international organizations that convene donor conferences to respond to refugee crises. In the supply-chain context, the goal ought to be protecting workers and spreading the benefits of globalization more evenly.

The task force should be Bangladeshi-led and include Western brands and retailers that have profited from selling Bangladeshi-made clothes. Western governments also need to step up, recognizing that their citizens benefit from the opportunity to buy these clothes at low prices. Traditional international funding agencies like the World Bank also ought to do much more to protect the workers in this sector. There is a role for private philanthropies, too.

A rough estimate of how much such a task force should seek to raise is $1.2 billion. This represents an approximation of the number of factories that haven’t been renovated multiplied by $250,000 — a ballpark figure for an average remediation.

Whatever budget the task force sets for itself, the amount should be understood as paying for the attainment of safety today. Once current gaps have been addressed, responsibility ought to shift to the government of Bangladesh. The fifth anniversary of Rana Plaza calls for a renewed and collective commitment to a safe and secure garment industry. (Reporting by Paul Barrett)

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