HL Deb 25 January 2005 vol 668 cc146-7WA
Lord Hylton

asked Her Majesty's Government:

What plans they and other developed countries have to mitigate the adverse effects of the end of the Multi-Fibre Agreement on disaster-stricken developing countries, such as Bangladesh and Sri Lanka, and in particular the impact on female employment. [HL637]

Baroness Amos

The Agreement on Textiles and Clothing (ATC—the successor to the GATT Multi-Fibre Arrangement—MFA) was introduced in 1995 following the Uruguay round of trade negotiations, and at the insistence of those developing countries with textile exporting industries, as a 10-year plan to fully integrate textiles and clothing into normal GATT rules and promote a more liberal, less distorted market. The most visible form of the ATC was the quota system imposed by importers (primarily the EU, US and Canada). These skewed normal trading patterns in these products to protect domestic producers, but also with the effect of enabling small developing countries to compete with more competitive countries such as China and India. These quotas have been gradually eliminated—though the majority, and all of those on the most sensitive products, were left until last—and were finally ended on 1 January. From that date 191 quotas on imports of textiles and clothing from 14 countries have disappeared.

DfID is currently funding two projects from the Poverty Reduction Fund with the Asian Development Bank, targeted at countries among those that are likely to feel the effects of the MFA phase-out most keenly, namely Bangladesh and Cambodia. The details are:


The purpose of this project is to help the government of Bangladesh reduce unemployment risks associated with the MFA phase-out and to improve job opportunities for female garment workers. The results expected from the project are:

  • a report on approaches to retraining of workers, and to employment and social protection measures;
  • pilot projects to benefit female garment workers;
  • an exchange of experiences with other countries like Cambodia;
  • extending the assistance more widely based on the results from the pilot project.


The purpose of the project is to help the government of Cambodia in understanding and addressing poverty and gender issues related to the phase-out of MFA, including creating alternative employment opportunities and ways of protecting retrenched garment workers. Results from the project include:

  1. a comprehensive situation analysis of the industry and workers in the sector;
  2. the introduction of small pilot schemes;
  3. the building of formal and informal safety nets and establishment of links with alternative employment;
  4. help to strengthen the capacity of the government, private sector and civil society to address the risk associated with the phase-out of MFA.
While the exact impact of quota elimination is difficult to predict, we do not expect Sri Lanka to be as badly affected as Bangladesh and Cambodia.