The Asian Development Bank (ADB) today said suspension of the Generalised System of Preferences (GSP) will have a negative impact on Bangladesh’s economy, suppressing its exports.
“US suspension of GSP is also likely to suppress exports, though garments are not covered by the scheme,” said Mohammad Zahid Hossain, Principal Economist of ADB’s Bangladesh Resident Mission.
Highlighting key findings of the Asian Development Outlook 2013 Update at a press conference at ADB office here, Hossain said labour unrest and a less competitive exchange rate may also curtail sales.
The ADB economist lauded the initiatives taken by the leading global brands and other stakeholders to improve occupational safety in the Readymade Garment (RMG) sector.
“These are positive initiatives. We hope these initiatives would bring benefit for the sector and stakeholders,” he said.
Responding to a question on GSP suspension, ADB Country Director Teresa Kho said, “This is really a matter between the US and government of Bangladesh. This is not a question for us to respond at this time.”
Clothing is king in Bangladesh, a country that exports more garments than any other in the world except China. It is responsible for four out of every five export dollars. Bangladesh’s $20 billion-a-year garment industry accounts for 80 percent of its total export earnings and contributes a major share of the country’s $115 billion GDP.
Source: BSS