RMG buyers eye GSP Plus as next growth driver

Global readymade garment (RMG) buyers have largely welcomed Bangladesh's 13th parliamentary election, viewing the smooth transition of power as a positive signal for business continuity, while setting their sights on securing preferential market access as the country approaches graduation from the least developed country (LDC) status this year.
Industry insiders believe buyer confidence, coupled with timely trade diplomacy, will be crucial for sustaining growth in the post-graduation era.
Bangladesh, the world's second-largest apparel exporter, has engaged with development partners and major markets to smooth the transition.
Speaking to The Financial Express, a representative of a leading global apparel brand says the company's headquarters was "very happy with Bangladesh's smooth transition of power through the recent parliamentary elections," noting that it has eased concerns among international stakeholders.
"Our business trend in Bangladesh remains positive, broadly in line with previous projections," he says.
He also says political transitions in the past did not disrupt their sourcing operations.
The only notable setback, he points out, was the 2024 labour unrest in Ashulia, which temporarily affected production and shipments.
Buyers are now closely watching policy moves by the new government, particularly on trade preferences, he says.
An effective mechanism with the European Union (EU) to ensure the continuity of duty-free access after LDC graduation will be "game-changing" for Bangladesh's apparel sector, he adds.
"As Bangladesh is set to graduate from the LDC status by 2026, securing the GSP Plus facility will be a major opportunity," he says, emphasising that preferential access to the EU market will help maintain competitiveness amid rising costs.
He further notes that international retailers expect political leadership, especially the BNP, to actively pursue such trade arrangements in line with earlier commitments to support export-oriented industries.
Another brand representative says they observed an almost non-violent parliamentary election in their 30 years of merchandising career.
An American brand representative says they have significant business in the EU market, where they are witnessing growing demand across all categories of apparel - from children's wear to adult, men's, and women's segments.
He expresses hope that the elections will also boost confidence at their global headquarters and lead to increased sourcing from Bangladesh.
Negotiations on US tariffs may have a positive impact on business in that market, he says.
Furthermore, he says, successful negotiations by the new government with the EU will help Bangladesh maintain its dominance in the European market even after LDC graduation.
Shehabudduza Chowdhury, vice-president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), says most buyers earlier indicated that they were looking for a democratic government and stable political conditions in Bangladesh.
Some buyers also reduced orders due to fears of conflict surrounding the national elections. As a result, a number of factories have already slipped into financial trouble because of the lower volume of orders over the past one and a half years, he says.
He hopes buyers will increase orders in the coming days as the election was held in a very peaceful manner.
His personal expectation of the new government is that it will appoint qualified, non-political individuals to ministerial positions related to business facilitation.
Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) President Mohammad Hatem says some buyers were worried about visiting Bangladesh before the elections.
"We hope they will come now because of this wonderful election and a smooth transition of power," he says.
He also says the European Commission's existing rules do not provide GSP Plus facilities for Bangladesh and revising those will be difficult.
Apparel exporters prefer Bangladesh not to proceed with LDC graduation at this stage, Hatem says.
"There was even an incident of stepping back from the graduation move just a week before the deadline."

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