"In The China Price, Tony Norfield recounts the story of a T-shirt made in Bangladesh and sold in Germany for €4.95 by the Swdiesh retailer Hennes & Mauritz (H&M). H&M pays the Bangladeshi manufacturer €1.35 for each T-shirt, 28 percent of the final sale price, 40¢ of which covers the cost of 400g of cotton raw material imported from the United States; shipping adds another 6¢ per shirt. Thus €0.95 of the final sale price remains in Bangladesh, to be shared between the factory owner, the workers, the suppliers of inputs and services and the Bangladeshi government, expanding Bangladesh’s GDP by this amount. The remaining €3.54 counts towards the GDP of Germany, the country where the T-shirt is consumed, and is broken down as follows: €2.05 provides for the costs and profits of German transporters, wholesalers, retailers, advertisers etc. (some of which will revert to the state through various taxes); H&M makes a 60¢ profit per shirt; the German state captures 79¢ of the sale price through VAT at 19 percent; 16¢ covers sundry 'other item.' In Norfield’s words, 'a large chunk of the revenue from the selling price goes to the state in taxes and to a wide range of workers, executives, landlords, and businesses in Germany. The cheap T-shirts, and a wide range of other imported goods, are both affordable for consumers and an important source of income for the state and for all the people in the richer countries.'
His blunt conclusion: 'Wage rates in Bangladesh are particularly low, but even the multiples of these seen in other countries point to the same conclusion: oppression of workers in the poorer countries is a direct economic benefit for the mass of people in the richer countries.'"
jacobvanloon
blakekathryn
theartofmadeline
