We rely heavily on the European Union for apparel exports. According to the EU data, Bangladesh's exports to the economic bloc stood 23.9 billion euro in 2022, which was 53.5 per cent higher compared with 2021. However, a recently published report by the EU has stated that three countries including Bangladesh did not show standard practice of human rights and labour rights, which may cause the withdrawal of the country's GSP (Generalised Scheme of Preferences) facility that 65 countries currently are entitled to enjoy. What the report describes poses a grave threat to the economy. Just a few months ago, there had been discussions on whether Bangladesh will be entitled GSP Plus facility or not. But now, the report has heightened a fear in the readymade garments (RMG) sector following unrest and its suppression with brutal force.
If Bangladesh loses the GSP facility, it will have to face 8.7 per cent duty, as per an opinion posted by the official website of the European Union. Needless to say, we may lose competitive advantage that will be picked up by Vietnam which has already had FTA (free trade agreement) facility with the European Union. India, Turkey, China and other competitor countries will also grab this opportunity. Against the backdrop, the GSP Plus facility seems to be the best way for Bangladesh to enjoy the tariff and quota barriers. But for this, the government should undertake necessary measures with particular focus on the labour and human rights.
For instance, the government can take initiatives to improve labour rights. It can reconsider the minimum wage of workers that can meet the present cost of living. It can strengthen the trade union and reform the labour law, if required. In addition, the government should prioritise the human rights, heeding to the concerns and suggestions of international human rights organisations.
Al Amin Hossain,
Student of Department of Finance,
University of Chittagong, Chattogram,
© 2024 - All Rights with The Financial Express
