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US downgrades Vietnam in latest labor-abuse report

One of the largest exporters of seafood to the country takes a reputational hit in the annual US State Department Trafficking in Persons (TIP) report.

The US State Department released its annual Trafficking in Persons (TIP) report on Thursday, striking a blow to the reputation of some of America's key seafood suppliers.

The report, which annually rates countries the State Department alleges have failed to adequately crack down on human trafficking, downgraded several countries from the 2018 report, accusing them of systemic failures to combat human trafficking, slavery and other labor violations.

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Among the countries seeing changes in rankings -- which go from Tiers 1 to 3, with "watch list" levels for countries under threat of sliding further -- are Vietnam, Poland, Germany, Denmark and Sri Lanka.

Vietnam, the largest supplier of pangasius to the US market and a significant supplier of shrimp, was downgraded from Tier 2, a level it has held for years, to Tier 2 Watch List, which means the country's failures to address trafficking problems could lead to a Tier 3 rating in future reports without action.

A Tier 3 rating can come with very real consequences. The US can restrict financial assistance to the violators, via pressure on development banks and the International Monetary Fund, for example, and leverage the rating in trade negotiations.

Tier 3 ratings can have an effect on seafood purchasing as well, as some retail buyers have policies avoiding purchase of seafood from countries deemed to be violating trafficking rules.

The TIP report is broadly considered the "gold standard" in assessing countries' efforts to combat trafficking, and as a result can play into other countries' evaluations, including the European Union's "card" ranking system.

Not long after Thailand was downgraded to Tier 3 in 2014, the European Union handed the country a "yellow card" for its failures to address IUU fishing. The European Union IUU regulation does not specifically address working conditions onboard fishing vessels. But improvements in combating IUU fishing may have a positive impact in controlling labor conditions in the fisheries sector.

Thailand's seafood exports to the west were widely considered in jeopardy following the 2014 TIP decision, but the country has since 2015 risen steadily in its ranking thanks to the institution of strict new laws on policing of trafficking and forced labor, particularly in the fishing and seafood processing communities.

Thailand moved to a Tier 2 ranking in 2018, and remains there in this year's report. Thailand was praised for its efforts in some areas, including more robust monitoring by the Thai Royal Navy, increased support for migrant workers, campaigns to raise awareness of trafficking and regulatory efforts to prevent it, but was criticized for failure to more forcefully crack down on trafficking in the fishing sector in particular. The report noted that just six cases of trafficking in the fishing sector were investigated.

The Thai Department of Labour Protection and Welfare did place more scrutiny on the seafood processing sector in 2018, with 1,906 inspections at "high-risk workplaces," including 259 inspections at seafood processing facilities, where it found 88 labor law violations.

Tier 3 rankings, however, can sometimes come with little or no consequences at all.

American's largest trading partner and the largest single supplier of seafood, China, was moved to the Tier 3 list in 2017, but remains the country's most important source.

China continued to take criticism for trafficking of domestic and foreign individuals, including forced labor on board Chinese-flagged fishing vessels. Slavery and trafficking aboard Chinese-owned fishing vessels were also cited as justification for lower rating in other countries.

Russia also remains on the Tier 3 list. Some European nations slid from last year, including Germany, which slid to Tier 2, along with Denmark, Poland and Italy for what the State Department deemed insufficient mechanisms to prevent trafficking.

Slavery and forced labor aboard fishing vessels continued to be a major theme throughout the report, and a driver behind several countries' ratings. Over 135 references to the fishing industry are made in the report, many linking it to forced labor.

Global law enforcement data presented in the report found that while identified victims of trafficking fell, the numbers were still well above levels over the past five years. In addition, prosecutions declined substantially, to just over 11,000, out of 85,613 identified victims.

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