Negligence and late responses by the textile and commerce ministries to allay the concerns of the US-based Walt Disney Company has deprived 16 Pakistani companies from exporting products worth $150 million to that particular company from April 1, 2014, senior officials of the ministries told The News. Take a look.......... On August 14, 2013 The News revealed that the Walt Disney Company had intimated authorities in Pakistan that it is going to terminate all orders from Pakistan worth $150 million by April 1, 2014 as 16 Pakistani textile companies were failing to meet international health and safety standards while handling the orders. Further, the company said, Pakistan would have to join the Better Work Programme (BWP) in case it wanted to avoid the cancelation of orders. However, officials said, a sluggish response from the concerned ministries led to Pakistan missing the chance to join BWP. Further, when Pakistan awakened from its deep slumber and urged the concerned US department to argue in favour of Pakistan before the top management of Disney, the company refused to oblige. Disney Corporation said this is its global policy and it could not bail out Pakistan from the impact of its policy. Top officials also told The News that Prime Minister Nawaz Sharif, who has been fighting hard to boost the country’s exports, has taken strong cognisance of the development and sought a report from the commerce ministry within three days over the mishandling of the issue. Pakistan’s total exports to the US stand at $3.6 billion, of which textile exports account for $3.2 billion. To make matters worse for the textile industry, Pakistan has also failed to improve its position in the worldwide governance index (WGI), reveal official documents available with The News. Pakistan scored just 19 points in the WGI, six points below the baseline to avoid cancellation of orders. However, textile ministry officials are of the view that Pakistan has been subjected to sheer injustice during the point awarding process. “Pakistan has been given just 0.5 points in the head of political stability despite the fact that the recent smooth transition of power is simply the result of political stability,” said one official. The sixteen companies which have been issued the letter of disconnection from Walt Disney between June and July 2013 include Younas, Afroze, Lucky, Sadaqat, Kamal, Gohar, and Satara. Official sources said textile industry officials fear that the cancellation of orders from April 1, 2014 might have a cascading effect with other US companies importing from Pakistan, such as WalMart, Jones Apparel, Nike, Levis Strauss and Gap, also cancelling their import orders. US companies – WalMart, Jones Apparel, Nike, Levis Strauss and Gap – annually import textile products worth $1.2 billion in total from Pakistani companies. In total 34 factories in Pakistan are exporting textile products to these US companies. These factories employ around 25,000 people, who are likely to become jobless in case the above mentioned US companies cancel their import orders. US companies have also expressed concern over a factory fire in Karachi in which hundreds of men and women perished, sources added. To make the situation worse, official sources said, European companies TESCO and ESDA may follow suit and cancel their orders due to the poor adherence of labour laws in Pakistan. The market access granted to Pakistan under GSP Plus would be impacted in such as case, he added. Pakistan hopes to increase its exports by $1.2 billion to 27 European Union countries in the calendar year 2014 under GSP plus. It is believed that Pakistan failed to respond to the International Labour Organisation (ILO) on poor labour conditions and a weak monitoring and enforcement system in timely manner. Working conditions in Punjab have deteriorated ever since the abolition of labour inspections almost seven years ago. On the other hand, the presence of underage workers is increasing everyday at these industrial units, another source added. Facing the risk of losing out on a huge chunk of its textile exports to the US and other countries, Pakistan is left with no option but to either improve the indicators or join the Better Work Programme (BWP). If Pakistan joins the Better Work Programme it will have to show adherence to three components that include i) compliance assessment activities in factories: auditors evaluate if the factories are adhering to ILO’s core labour standards and national labour laws 2) continuous improvement: better work staff facilitates dialogue between managers and workers to address their report’s findings and submits regular progress reports and 3) stakeholder engagement: buy-in for the programme and activities occurs at all levels, including government, employers, unions and workers, and international buyers.
Posted on: Wed, 12 Mar 2014 05:44:24 +0000
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