The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has called on the European Union (EU) to extend the transition period from the Everything but Arms (EBA) initiative to the Generalised Scheme of Preferences Plus (GSP Plus) scheme.
This appeal aims to facilitate continued growth in Bangladesh’s garment exports to EU member countries amidst the nation’s impending graduation from the least developed country (LDC) status.
BGMEA President SM Mannan Kochi raised this request during a meeting with Charles Whiteley, the EU Ambassador to Bangladesh, at the BGMEA office in Dhaka.
Ambassadors from other EU countries also attended the meeting, underscoring the importance of the dialogue between Bangladeshi garment makers and their European counterparts.
Kochi emphasized that extending the EBA transition period is crucial for Bangladesh to maintain its economic momentum post-LDC graduation. The EBA initiative currently grants Bangladesh duty-free and quota-free access to EU markets for all products except arms and ammunition. As Bangladesh prepares to graduate from the LDC category, it will lose these preferential trade benefits, making the transition to the GSP Plus scheme vital for its export-dependent economy.
“The extension of the EBA is crucial to ensure that Bangladesh can sustain its economic growth even after graduating from the least developed country category,” Kochi stated.
The GSP Plus scheme offers a similar but more stringent set of trade preferences, requiring adherence to international human rights, labor rights, environmental protection, and good governance conventions.
In addition to requesting an extended transition period, Kochi sought the EU’s cooperation in building Bangladesh’s garment industry’s capacity. He highlighted the need for support in skills development, technology upgrades, and compliance with international standards.
Kochi also called on the EU envoys to engage with European buyers to ensure fair pricing and ethical sourcing practices. Ensuring fair prices and ethical sourcing is critical for Bangladeshi garment manufacturers, who often face pressure to lower costs at the expense of worker welfare and environmental standards.
The garment sector is a cornerstone of Bangladesh’s economy, accounting for more than 80% of the country’s export earnings. However, the industry faces several challenges, including rising production costs, increasing competition from other low-cost producers, and the need to improve labor and environmental standards.
Graduating from LDC status presents both challenges and opportunities for Bangladesh. While it signifies economic progress, it also means losing preferential trade benefits like the EBA. Transitioning smoothly to the GSP Plus scheme would help mitigate the potential negative impacts on the garment sector, ensuring continued access to EU markets.
While the EU delegation has not responded immediately to the BGMEA’s requests, the meeting indicates a positive step towards continued dialogue and cooperation.
