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EU proposal may affect Bangladesh garment exports

Nov 19, 2021
EU proposal may affect Bangladesh garment exports

Bangladesh

A proposal by the European Union may affect Bangladesh's apparel shipment to the bloc even if the country is awarded the Generalised System of Preferences (GSP) Plus status after becoming a developing nation.

In the proposed GSP Plus scheme, the EU said that the value of a particular garment item from a country eligible for duty-free export benefit under the bloc's Everything But Arms (EBA) facility may cross 6 per cent of the total imported value of apparel. In this case the zero-duty facility will not be applicable for the product even if the GSP Plus status is granted. This is as per Commerce Secretary Tapan Kanti Ghosh.

The value of the total imported apparel from Bangladesh to EU countries has already gone past the threshold and now stands at more than 9.74 per cent including items in 2019.

The secretary said that they will launch an intense negotiation with the EU about the 6 per cent safeguard measure. He also said that, technical committee of the ministry was working on the issue to get the detailed picture and assess the implication of the safeguard measure. The EU is the largest export destination for Bangladesh.

The new GSP Plus scheme will come into effect from January 2024 and will continue up to 2034.

If the proposed rules remain unchanged, the average tariff on apparel exports from Bangladesh to the EU will rise from the currently zero to an average of 12 per cent.

The new proposals will be final when adopted by the European Parliament and the European Commission, the executive branch of the EU. Adoption could take place in the last quarter of 2022.   

Source: The Daily Star

Image Source: Google Images

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