• Financial

The new announcement of the United States is raising concerns, the world economy is on the way to a deep crisis

  • Financial
  • 20 November, 2023 23:44:45

News desk:  US President Joe Biden has recently signed a new memorandum on the rights of workers worldwide and improving their standards. The United States will impose various sanctions, including trade and visa restrictions, on those around the world who take away labor rights, intimidate and attack workers.

The issue of Bangladesh also came up in the speech of US Secretary of State Anthony Blinken while announcing the issuance of the memorandum. Blinken says, we want to live with people like Kalpana Akhter, a Bangladeshi garment worker. 

Meanwhile, the long-standing dollar crisis in Bangladesh has recently become more acute. To deal with the crisis, the government imposed restrictions on imports from the beginning of the last financial year. LC opening of various products is regulated. Although there was no immediate impact on imports, growth turned negative from October last year. As a result, the growth of LC openings is steadily decreasing. As a result, the prices of products in the country are increasing due to the decrease in imports. Due to not being able to open the LC, the import and trade through various ports of the country has decreased. Benapole Customs House has suffered a collapse in revenue collection due to low imports. 

On the other hand, businessmen are worried about the announcement of the new policy of the United States to ensure labor rights around the world. Especially concern has arisen among traders in the clothing sector. Unable to open LCs as per demand, many entrepreneurs have reduced essential imports like industrial raw materials, consumer goods and capital equipment.

According to the statistics of Bangladesh Bank, in the first 4 months (July-October) of the current financial year, LC opening has decreased by 11.22 percent. A total of 2 thousand 182 million dollars LC has been opened for import of goods in these 4 months. Whereas during the same period of the last financial year LC was opened for about 2 thousand 466 crore dollars. At this time, the LC settlement of the banks also decreased by more than 24 percent.

Besides, in the first 4 months of the financial year 2022-23, banks settled LCs worth $2,894 crore. From there it decreased to 2 thousand 197 million dollars in the first 4 months of the current financial year. Besides, negative growth in imports has been going on for 12 consecutive months till September this year.

Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Executive President Mohammad Hatim told the media that the import of both capital equipment and raw materials has decreased. The production capacity is not being utilized due to gas crisis. All in all, the economy is headed for a major crisis.

The product importers said that various conditions are being given by the bank to open the LC. On the one hand, production is decreasing, on the other hand, sales of consumer goods are also decreasing due to inflation.

According to the country's garment sector stakeholders, the US's statement on the issue of labor rights after restrictions on law enforcement and visa policies has become a cause for concern. The memorandum, announced after the political context and labor protests over minimum wages in the garment sector, is now scaring entrepreneurs anew.

Incidentally, the United States has five action plans to actively consolidate and advance workers' rights worldwide. 

These are – 

First:  The United States will work with governments, workers, labor organizations, trade unions, civil society, and the private sector around the world to protect internationally recognized labor rights. As part of this, US ambassadors and embassies around the world will engage with workers and labor unions to ensure their voices are reflected in US work. 

Second:  Those who threaten, intimidate workers, attack labor union leaders, labor rights activists, labor organizations will be subject to sanctions, trade embargoes and visa bans. 

Third:  Increase the capacity of the US federal government to improve the rights of workers abroad by prioritizing job opportunities for skilled workers. To this end, US officials will be trained on workers' rights so that they can detect and prevent labor rights violations. 

Fourth,  the United States will work with governments and multilateral organizations such as the United Nations and the G-20 to improve labor rights and labor standards. 

Fifth:  U.S. efforts will be stepped up to ensure the protection of workers in its own trade agreements and supply chains. At the same time, the United States will stop importing clothing produced using forced labor.

But recently the foreign minister of Bangladesh. AK Abdul Momen said, the United States is a country of sanctions. They can (if they want). They are big people. We will work according to our reality. We cannot become the United States in one day. Nothing will happen to Bangladesh if the United States imposes sanctions.

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