| 13.5°C Dublin

EU sanctions warning over collapse of factory

The European Union has warned of potential trade sanctions in the wake of the collapse of a factory in Banglasdesh last week – while a court in the Asian country has asked officials to seize assets belonging to the owner of the complex.

The property and assets belonging to Sohel Rana, owner of the eight-story Rana Plaza that killed at least 394 people when it caved in, should be seized, as well as those of four owners of garment factories in the complex, High Court judges Mirza Hussain Haider and Muhammad Khurshid Alam Sarkar said in a ruling this week in the capital, Dhaka.

The EU said it was considering action under its trade rules to encourage changes in the nation's supply-chain operations.

Textiles contribute more than 10pc of Bangladesh's gross domestic product and about 80pc of the nation's exports, mainly to the US and the European Union, says the Bangladesh's manufacturers' association. Penneys owner Primark said this week that its team in Bangladesh has been working to put in place immediate and long-term help for victims of the disaster. Workers making Penneys clothes were among those who perished.

Primark will also pay compensation to the victims of this disaster who worked for its supplier. This will include the provision of long-term aid for children who have lost parents, financial aid for those injured and payments to the families of the deceased.


The collapse of the building in Savar on April 24 is at least the third reported industrial accident in the South Asian nation since November, when 112 people died in a fire at a workshop that was producing clothes for companies including US retail giant. Bangladesh's central bank responded to the Savar incident yesterday by forbidding fund withdrawals from local bank accounts of Mr Rana and four garment-factory owners.

The High Court also barred transfer of assets held by the five. The money in the accounts will be used to compensate families of dead and injured workers, the central bank said. Protesters in and around Dhaka blocked roads and clashed with police almost a week ago demanding punishment for Mr Rana, a member of the ruling Awami League political party's youth wing.

Rescuers have pulled 2,437 people alive from the rubble. The government hasn't provided estimates on how many are missing.

Hundreds of relatives are still at the location waiting to learn the fate of family members.

"The sheer scale of this disaster and the alleged criminality around the building's construction is finally becoming clear to the world," EU Trade Commissioner Karel De Gucht and Catherine Ashton, high representative for foreign affairs, said in a joint statement yesterday.

To incentivise responsible management of supply chains, the EU is considering action through its Generalised System of Preferences program, which gives Bangladesh duty- and quota-free access to its market. (Bloomberg)

Irish Independent