Monday, April 6, 2020 | ePaper

GSP suspension to Cambodia may increase BD RMG export to EU

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Khmer TimesĀ  :
Cambodia's readymade garment (RMG) exporters are expecting that the suspension of the European GSP facility would lead to an increase in export orders for Bangladesh in the EU market.
They said that there were similarities between the RMG products produced in Cambodia and Bangladesh for export to the EU market.
Buyers may shift their sourcing from Cambodia to other countries due to the rise in the prices of products manufactured in the Southeast Asian country because of payment of duties due to the suspension of the GSP facility, the exporters said.
They, however, said that although Bangladesh might be benefitting from the suspension, Vietnam would be the sole country to benefit from the shifting of orders for high-value-added products.
The EU last week partly suspended the Generalised Scheme of Preference facility to Cambodia.
The European bloc generally provides the duty-free benefit to some least developed and developing countries under the 'Everything But Arms' deal to help boost trade and business.
Bangladesh is the second largest exporter of RMG product to EU market with around $21 billion of annual shipments as it gets GSP facility in the EU market.
When asked about the impact of EU's decision suspending GSP facility of Cambodia on Bangladesh, BGMEA president Rubana Huq said on Saturday, ' This may create some opportunities for other sources countries, including Bangladesh, in the shorter term.'
'But in the longer term this would act as a significant signal for Bangladesh to prepare so that we can continue to have our market access either through extension of EBA negotiation or lobbying for the GSP Plus, for which the labour narrative will be a predominant factor,' she said.
She also said that the GSP suspension would certainly put Cambodia's apparel industry in a challenging situation as they would now need to pay 9.0 to 12 per cent duty on their exports to the EU.
Bangladesh Garment Manufacturers and Exporters Association data showed that the EU imported apparels worth $4.33 billion from Cambodia in 2018 while its total apparel exports to the world in the year stood at $7.83 billion.

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