DHAKA: Seventy top retailers promised to open their Bangladesh factories to safety inspections within nine months as part of a pact finalized and released on Monday in the wake of a deadly garment factory collapse.
The mainly European brands will underwrite repairs and renovations if inspections reveal their factories to be unsafe, according to the legally binding agreement, signed with unions after the collapse of Rana Plaza in April killed 1,129 people in one of the world’s worst industrial disasters.
“Initial inspections at every factory will be completed at the latest within nine months, and plans for renovations and repairs put in place where necessary,” the pact’s steering committee said in a statement.
Labour umbrella groups, including Swiss-based IndustriALL and UNI Global Union, stepped up pressure on Western retailers to sign the agreement after the nine-story building in Dhaka crumbled on April 24.
Retailers, including Inditex, H&M and Primark, started agreeing to the Accord on Fire and Building Safety in May to improve shocking factory conditions in Bangladesh.
The country is the world’s second biggest apparel exporter, with clothing accounting for 80 percent of its overseas shipments.
“The terms of reference and the rules of the accord are set in place, we can now identify the best people and put together the team in Bangladesh who will be charged with carrying out this vital work,” said UNI Global Union general secretary Philip Jennings.
Retailers will submit details of their suppliers in Bangladesh by July 15 which will then be publicly released for the first time, said the statement outlining the new accord.
A team of inspectors aim to “identify grave hazards and the need for urgent repairs” at the factories. Retailers must commit for two years to the garment plants flagged for safety improvements, the statement said.
A headquarters to oversee implementation of the five-year pact will be set up in Amsterdam with another office in Dhaka, it said.
While leading European retailers have joined the agreement, American brands such as Walmart and Gap have snubbed the accord and opted for self-regulation.
Walmart, the world’s largest retailer and one of Dhaka’s top buyers, has promised to inspect its Bangladeshi suppliers and publish the results, while Gap says it launched its own drive in October last year.
The task of inspecting and improving factories could prove hugely daunting. A survey by a prestigious Dhaka-based engineering university last week found nine out of 10 Bangladeshi garment plants are risky structures, and many were built without qualified engineers.
It is not clear how much retailers are willing to spend on repairs under the pact. But a study by a local group has found the cost of renovating and retrofitting Bangladesh’s garment factories could reach $3 billion.
The group of 70 retailers has approached the World Bank and others about financial assistance for the renovation program, a representative of the retailers said.
“We have held initial talks with the World Bank, the Dutch and Danish governments and the European Union for soft loans and other funds to finance the renovation programme,” Andy York from British mail order retail group N Brown Group said.