Bangladesh will face intense competition in the EU market after its graduation from the least developed country category, a noted economist said today.
Bangladesh will be slapped with a new 12 per cent duty on garment shipment to the European Union when Vietnam will enjoy tax benefit to the same market, said Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue (CPD).
When Bangladesh will be graduated to a developing country, Vietnam, a major competitor of the south Asian nation, will sign a free trade agreement (FTA) with the EU, he said.
The cumulative duty for Bangladesh to the EU markets will be much higher, he said.
Not only the EU, Vietnam will also obtain the duty benefit to other major markets like Canada, USA and Australia, as Vietnam is also a member of the Trans Pacific Partnership Agreement and had signed the Regional Comprehensive Economic Partnership Agreement, Rahman said.
So the scope for garment shipment may get shortened in the next seven to eight years if the government does not take necessary action plans to expand the business horizon, he said.
It is a responsibility of the state to sign the FTA, preferential trade agreements or comprehensive economic partnership agreement with the countries concern, bringing massive reforms and protecting labour rights to enjoy duty benefits, he said.
Garment manufacturers, exporters, union leaders, researchers and experts took part in the discussion moderated by Debapriya Bhattacharya, distinguished fellow of the CPD.