European retailers have appealed to the European Union (EU) to extend the Generalised System of Preferences (GSP) facility for Bangladesh’s readymade garments products, including woven, knitwear, and home textiles, before the end of the decade. The EuroCommerce, the representative body of Europe’s retail and wholesale sector, has made this appeal in a letter to the EU authorities, citing a possible exodus of international brands if the duty benefit is not extended.
The EuroCommerce letter emphasised that not extending the GSP facility for Bangladesh’s readymade garments products would have severe consequences for the country’s economy and put the sustainability standards at risk. The EU GSP facility, which provides duty-free access to the European market, will expire in December 2023, and a new GSP scheme will be implemented from January 2024 to 2034.
Possible Negative Impact on Bangladesh’s Economy and Sustainability Standards
The letter, sent by the Bangladesh mission in Sweden to the country’s commerce ministry, states that the removal of duty benefits could lead to the relocation of international brands to alternative destinations, causing a negative impact on Bangladesh’s overall GDP. Furthermore, the letter highlighted that the incentives for Bangladesh to continue its reform path could be reduced if the country loses preferential access to the European market.
EuroCommerce Director General, Christel Delberghe, stated in the letter that the sustainability standards developed over years of hard work might also be at risk if the duty benefit is not extended. She also stressed the importance of keeping Bangladesh’s readymade garment industry sustainable and competitive, as it is the country’s main export sector and the primary source of employment for millions of people.
Support from the European Parliament’s Committee on International Trade
The EuroCommerce’s appeal for an extension of the GSP facility for Bangladesh’s readymade garments products has gained support from the European Parliament’s Committee on International Trade. The committee has requested the European Commission to consider extending the facility and take into account the social and economic impact on Bangladesh if it is not extended.
Conclusion
In conclusion, the extension of the GSP facility for Bangladesh’s readymade garments products is crucial for the country’s economy and its sustainability standards. EuroCommerce’s appeal to the EU authorities highlights the significance of the readymade garment industry in Bangladesh and the consequences of not extending the duty benefit. It remains to be seen whether the EU authorities will take heed of the appeal and extend the GSP facility for Bangladesh’s readymade garments products.