Bangladesh has requested the European Union to consider revising its new (draft) GSP scheme, particularly the safeguard clauses, so that all exportable products, including ready-made garments, can benefit from trade privileges in beyond 2029.

At a joint committee meeting attended by senior EU diplomats in Dhaka yesterday, Economic Relations Division officials also urged the EU to consider adopting rules of origin criteria (RoO) rules, saying it is “extremely difficult, particularly for capacity-constrained countries graduating from the LDC list.” Status.”

An ERD official present at the meeting told TBS that the EU representatives assured that they would consider the requests proposed by Bangladesh, including the GSP and the climate fund.

Bangladesh, which is expected to graduate from Least Developed Country (LDC) status in November 2026, will continue to access existing duty-free privileges under the existing Generalized System of Preferences (GSP) and EBA ( everything except weapons) until 2029. The EU grants an additional three-year transition after graduation.

To continue to benefit from trade benefits beyond this period, Bangladesh can apply for the new GSP+ system, which has stricter eligibility criteria requiring Bangladesh to add more national value to its products and meet the human rights, labor and environmental standards.

With the new GSP regime and its safeguard provisions postponed to the end of 2027, the EU may consider a waiver of these safeguard measures on Bangladeshi textiles and garments, said Economic Relations Division (ERD) Secretary ), Shahriar Kader Siddiky, during the meeting.

The safeguard measures embedded in the EU GSP scheme, if left unchanged, will not allow Bangladesh to continue to enjoy duty-free access to apparel products, he stressed in his presentation, view by TBS.

Bangladesh should not be penalized for its lack of export diversification and impressive development progress reflected in LDC delisting, he insisted.

“It is also unfair that some non-LDCs can access GSP+ facilities for apparel products, while a graduated LDC like Bangladesh will be excluded,” the ERD secretary said, strengthening Bangladesh’s argument for future access to trade preferences in the country’s largest export market. which has benefited since 2001 from duty-free access to the European market for “everything except weapons”.

“It is also unfair that some non-LDCs can access GSP+ facilities for clothing products, while a graduated LDC like Bangladesh will be excluded.”

Shahriar Kader Siddiky, Secretary, Economic Relations Division (ERD)

Furthermore, Siddiky argued that given that Bangladesh is already a significant supplier under the EBA, allowing it to continue to benefit from GSP+ without measures is unlikely to cause disruption.

The 12th session of the Bangladesh-EU Joint Commission in Dhaka was co-chaired by Siddiky and Paola Pampaloni, Deputy Director General of the Diplomatic Service of the European Union.

The head of the EU delegation to Bangladesh, Ambassador Michael Miller, and other EU diplomats were also present.

An ERD official present at the meeting told TBS that EU representatives had assured that Bangladesh’s proposal would be presented to the European Parliament, where a final decision would be made.

Wishing to review the flexible Rules of Origin (RoO) criteria in the GSP+ provisions, the Bangladeshi side said the current requirements of double processing in apparel exports and 50% domestic value addition for non-garment items are “fairly strict” given the value. current chain-led global trading system in which countries specialize in only one or a few components.

The EU could consider single-step processing for Bangladesh’s ready-made garment products and 30 per cent value addition for other products, under the GSP+ scheme, the ERD secretary said.

Over the years, EU officials, in a series of meetings with Bangladeshi authorities, have stressed the urgency of improving rights and environmental issues to benefit from the new program.

At yesterday’s meeting, Bangladesh officials said all 32 relevant international conventions had already been ratified and requested technical and financial assistance from the EU to implement them.

They also expect that EU technical cooperation in the areas of export diversification, strengthening competitiveness, increasing investments and improving logistics will make Bangladesh’s exit from Fluid and durable PMA.

Given that the EU has so far offered unilateral trade preferences and has become the main destination for Bangladesh’s exports, many of the potential challenges of LDC exit can be significantly mitigated by maintaining preferential access to the market even after LDC exit, they argued.

The ERD secretary spoke of Bangladesh’s renewed efforts for massive financial sector reforms, which require more foreign loans on concessional terms.

To avoid the usual delays in processing project loans, Bangladesh now prefers budget support to meet current needs, he said, stating that budget support accounted for $2 billion out of the total 9 .89 billion that Bangladesh received in foreign loans during the last fiscal year (FY24) ended. in June. EU loans and grants totaled $172 million in FY24.

Good governance, control of inflation and consumer spending, job creation and poverty reduction are among the areas where major intervention is needed, Siddiky listed, laying out the priorities of the caretaker government.