Tightening of purses by German consumers is likely to affect Bangladesh’s RMG exports to the country, says Achim Troster, German ambassador to Bangladesh. Germany has been affected by the Russian war in Ukraine and rising inflation across the world, says the ambassador. To benefit from the GSP+ status, Bangladesh needs to comply with human rights, labor rights and environmental standards, adds Troster
Germany’s RMG orders from Bangladesh have declined significantly in the past months as warehouses across Europe are still stocked with unused inventory. To tide over this, the Bangladesh garment industry needs to diversify and concentrate more on high-value products, Troster opines.
Compliance to GPS conventions required
He warns, Bangladesh should not take GSP+ facilities for granted as EU is likely to insist on the nation’s compliance to all 27 conventions linked to the facility. The 27 international conventions that need to be complied by Bangladesh include: compliance to human rights, labor rights and environmental standards. Bangladesh does not need to comply completely with all the rules but needs to demonstrate an ability to improve.
Domestic analysts believe, this could be challenging for Bangladesh and requires the government to actively implement it. Bangladesh needs to ensure compliance with these conventions by 2029 as EU might be inflexible by then, says Troster. A majority of the parties concerned in the EU organizations urged Bangladesh to comply, while a few analyst recommended the country to continue the current status quo. The extensive sanctions levied against Russia have caused immediate economic blows to the Western countries. They may also impact Bangladesh as it graduates from least developed status, warns Troster
EBA scheme boosts Bangladesh-Germany trade
One of the biggest export markets for Bangladesh, Germany’s bilateral trade with the country is increasing gradually. Trade is getting a boost by the EU tariff preferences granted under the "Everything but Arms" arrangement. Bangladesh mostly exports textiles to Germany while it imports machinery as well as chemical products and electrical goods from the country. The German government is focusing on renewable energy, and is committed to positive climate action despite the Russia-Ukraine war. It is negotiating with the Bangladesh government on the matter. In March, a German delegation offered Bangladesh privileged partnership on climate and development. The partnership will concentrate on adaptation and mitigation, and emphasize on renewable energy, says Tröster.