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Bangladesh is likely to graduate out of the group of least developed countries (LDCs) by 2024. While this represents a major transition in terms of its development, demonstrating the country’s impressive socio-economic achievements, it also gives rise to concern about potentially sizeable costs due to the resulting loss of access to various support...
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... The Heckscher-Ohlin theory claims that a country's comparative advantage depends on relative factor endowment across nations, and that trade affects relative factor prices both within and across nations [11]. The United States (US) and the European Union (EU) are two of the biggest Ready-Made Garments (Here, RMG comprises Bangladesh's main ten trading knitwear (Harmonized System-HS 61) and woven wear (HS-62) markets for Bangladesh [12]. Bangladesh is the second largest exporter of these products to both the US and EU markets [13]. ...
This paper conducts a Revealed Comparative Advantage (RCA) examination for RMG products of Bangladesh and compares it with prime contenders of Bangladesh. In this paper, seven nations have been picked as prime contenders of Bangladesh: China, Hong Kong, India, Pakistan, Srilanka, and Vietnum. Mainly, the RCA has been investigated with the assistance of the Balassa Index for the two significant fare goals of Bangladesh's attire-the USA and the European Union (EU). The reason is to investigate the effect of the US-GSP suspension on Bangladesh just as how it impacts Bangladesh's assembling areas and the fare of RMG merchandise. The RCA breaks down the degree of fare rivalry among Bangladesh and its significant rivals. The study applies the Balassa Index. It claims that the level of competition among significant contenders escalates with the usage of the US-GSP prerequisites to get the GSP facilities in the US market. This examination shows a period series investigation of RCA of 18 years, beginning from 2000 to 2018, for Bangladesh's exports to the EU and the US markets. The findings from this paper propose that Bangladesh has a close favored position over other major contending countries in the USA and EU markets for the main ten RMG things. This result shows that Bangladesh's RMG part is more significant in the EU market than in the USA market.
... The textile sector is recently known as the most contaminating territory of the economy (EEA, 2022). The volume of textile production and trade significantly influences the economies of some countries including Turkey and Bangladesh, and investigating their environmental activities can lead to help policy decisions (Razzaque M. A., & Rahman J, 2019). ...
Objectives: This study investigates the impact of European Union (EU) environmental policies on Bangladesh's and Turkey's textile industries. It aims to identify the challenges both nations face in implementing these regulations and explore opportunities for sustainable development by comparing their approaches. Theoretical Framework: The research is grounded in environmental governance and industrial sustainability principles, emphasizing the interplay between regulatory frameworks and economic practices in developing countries. Method: A mixed-methods approach combines an extensive literature review with analyzing country-specific data from existing studies. This method provides a comprehensive understanding of the challenges and strategies employed by both nations. Results and Discussion: Findings reveal that compliance with EU regulations is challenging for Bangladesh and Turkey due to their reliance on textile exports. With its diversified economy, Turkey faces high financial requirements, while Bangladesh struggles with rapid population growth and unplanned industrialization. Common issues such as air and water pollution, along with inadequate waste management systems, are prevalent in both contexts. Differences emerge in regulatory frameworks and resource management, influencing their respective adaptation strategies. Research Implications: The study highlights the need for customized policy interventions and international collaboration to support compliance efforts in both countries. Enhanced environmental practices can foster the achievement of Sustainable development Goals (SDGs) while ensuring economic growth. Originality/Value: This research offers a comparative analysis of two major textile-exporting nations, providing fresh insights into balancing economic development with environmental responsibilities in the global textile sector.
... Bangladesh's graduation from the LDC group will impact export-led economic growth, while arguably, the high concentration of the export basket puts it at a higher risk of potential trade volatilities (Razzaque 2018a). If the export basket concentration remains the same in the post-LDC graduation period, the impact of the graduation would be translated through the impact on the RMG sector (Razzaque and Rahman 2019). This article estimates the impact of the LDC graduation on Bangladesh's sectoral (RMG) and total exports, as well as potential welfare losses. ...
Bangladesh will graduate from the LDC list by 2026. Currently, Bangladesh's exports of readymade garments (RMG) benefit from international support measures which allow preferential trade in major export destinations, such as the EU. After graduation, Bangladesh's exports, particularly RMG, will face competition from mega trading blocs, such as RCEP and CPTPP. This article employs the GTAP model to estimate the impact of Bangladesh's graduation from the LDC category and how mega FTAs are likely to affect Bangladesh's exports and potential welfare. The model also considers the scenarios of either United States or the UK or both joining the CPTPP. The model results show that Bangladesh's graduation will lead to a fall in GDP and RMG exports by 1.53% and 11.8%, respectively. The negative impact is magnified when we factor in the mega-trading blocs. Further negative impacts are observed when either United States or the UK or both join the CPTPP.
... The duty-free market access of Bangladesh under the EBA initiatives of the EU aided to expand its market in these countries. Besides, the derogation of EU rules of origin (RoO) in 2011 allowed a single transformation for LDC clothing exports under EBA, which greatly aided Bangladesh's performance to boost apparel exports (Razzaque and Rahman, 2019). It generated a reinvigorated supply from the woven garment sector, raising Bangladesh's share in EU apparel imports. ...
Over the past decades, the European Union (EU) has emerged as an indispensable trade and development partner for Bangladesh. The EU is by far the country’s largest export market, taking almost half of Bangladesh’s exports. Taking advantage of the Everything But Arms (EBA) initiative, which provides preferential duty-free and quota-free market access for goods originating from the official category of Least Developed Countries (LDCs), Bangladesh’s combined exports to the EU expanded rapidly from just US23.2 billion in 2021/22. In value terms, more than 80 per cent of all Bangladesh’s exports that receive any tariff preferences is obtained from European markets. Bangladesh has been the single largest beneficiary of EU Generalised System of Preferences (GSP) schemes.
Along with its contribution to trade, the EU has been one of the most important development partners as well. It provides generous budget support to the government of Bangladesh, supports numerous social and physical infrastructure projects, and is a critical source of technical assistance in a wide variety of areas. Over the past five years, the cumulative official direct assistance (ODA) from EU institutions and individual EU countries amounted to 3.5 billion, accounting for about a quarter of all such flows into Bangladesh. The FDI stock in Bangladesh due to the EU is more than 12 per cent of the total such stock.
Emerging challenges affecting Bangladesh-EU trade and economic relations:
Bangladesh still has huge export potential in the EU as it is estimated that currently only 60 per cent of export potential is utilized. However, the nature of trade relations with the EU, or, more precisely, Bangladesh’s dependence on EU trade preference, is now set to come to terms with other major developments that will require a profound transformation of the current trade and cooperation regime.
... In 2019, the global textile market size was valued 961.5 $USbn; it is projected to grow by 4.3% (compound annual growth rate, without taking the effects of COVID-19 into consideration) by 2027 (InkWorld, 2020). Textile imports from Bangladesh to the EU have trebled from 2008 to 2015 (European Commission, 2020c), with positive reports of job gains especially for women working in the textile industry (Razzaque and Rahman, 2019). At the back of these gains, reports of unsafe working conditions not only pose a threat to the fashion industries, but also undermine the gains achieved from trade liberalisation. ...
Successful implementation of the Sustainable Development Goals (SDGs) requires world countries to account for actions that inadvertently generate negative impacts on other countries. These actions/effects are called 'spill-overs', and can hinder a country's SDG progress. In this work, we analyse negative social spillover effects, focussing specifically on the occupational health and safety aspects of workers in textile supply chains. We select two indicators: fatal accidents and non-fatal accidents that take place in global supply chains for satisfying consumption of textile products (such as clothing, leather products) by European Union (EU) countries. Specifically, we scan global supply chains originating in countries outside of EU for meeting the demands of its citizens. To this end, we employ a well-established technique of multi-regional input-output analysis, featuring information on 15,000 sectors for 189 countries, to scan international supply chain routes that are linked to consumption of textile products by EU countries. Our findings suggest that Italy, Portugal are collectively responsible for about 80% of both fatal-and non-fatal accidents that are attributed to the EU's consumption-based footprint. These findings not only call for a need for coherent SDG policies that consider spillover effects, but also the need for these effects to be included in EU's strategic instruments and policy-related tools.
... Consequently, market access conditions in most important export destinations will become more stringent. Several studies predict that Bangladesh will see a significant loss in export earnings (UNCTAD, 2016;Razzaque and Rahman, 2019;Rahman and Bari, 2019). By signing bilateral and multilateral FTAs with major partners, Bangladesh could preserve market access conditions and thus not disturb export flows and competitiveness in the post-graduation period. ...
... Bangladesh currently enjoys duty-free quota-free access in the European Union and the United Kingdom under the EU's Everything But Arms (EBA) initiative, having a preference margin of around 12% for most exporting apparel items (Razzaque and Rahman, 2019). Thus, the impact of an FTA with these countries is expected to be zero. ...
... This is because there are some products for which Bangladesh could not satisfy the rules of origin criteria and thus ended up paying tariffs. According to recent data, the preference utilization rate of Bangladesh in the EU is almost 97% (Razzaque and Rahman, 2019). This implies that the country pays tariffs on the remaining 3% of its exports to the EU (including the UK). ...
... The report concludes, "the country has to prepare itself over the next few years to counter these losses". In addition, a paper of the researcher from the Policy Research Institute, Bangladesh (Razzaque & Rahman, 2019) analyzes the impact of trade with the EU, including a US$1.6 billion decline in exports and the possibility of China, Cambodia, India, Turkey, and Vietnam increasing their exports instead. Besides, in a paper written by Bangladesh government officials, it was pointed out that "a continuous effort should be given by the government by gaining experience from another developed country to reduce risk factors to ensure sustention of current progress" (Rahman, Sony, Rubel, Alam, & Liza, 2020). ...
... The impact of tari hikes after graduation will potentially undermine Bangladesh's already weakened comparative advantage. Utilising a partial equilibrium model, as in Razzaque and Rahman (2019), the likely consequences on exports due to the erosion of LDC preferences are estimated using 669 HS 8-digit products that were exported to China in 2018. The results suggest an adverse e ect on exports to the tune of 12.5 per cent (i.e., $122.7 million) ( Table 7.8). ...
Over the past couple of decades, the People’s Republic of China has emerged as a global economic superpower having achieved high economic growth sustained for a very long period of time and in the process becoming the world’s largest merchandise exporter. Its rapid structural transformation and development transition to an upper-middle-income country accompanied by a fast-growing and massive urban middle and affluent consumers have also turned it into a major global market, accounting for more than 10 per cent of world imports. For suppliers across global economies, China presents an unprecedented opportunity for export expansion.
Along with its growing economic and political significance, China has also started proactive engagements with many countries through investment activities. In recent years, advancing connectivity to facilitate trade and promote economic cooperation arrangements has become a priority agenda for Chinese policymakers. Through the Belt and Road Initiative (BRI), China’s state-owned enterprises have undertaken trade-related infrastructure development projects at continental scales. At the same time, China’s private financers are taking a hands-on investment approach in many developing countries to look for new trading opportunities created through infrastructural development and attracted by scal and nancial incentives offered to foreign investors.
China is already the largest trading partner of Bangladesh. However, this trade has been overwhelmingly dominated by Bangladesh’s imports from China. Chinese products account for more than one- fth of Bangladesh’s total imports. On the contrary, China’s share in Bangladesh’s exports accounts for only about 2 per cent. Therefore, exploiting the Chinese market in expanding exports constitutes one important policy consideration. Bangladesh’s economy has also expanded considerably through robust economic growth of the past decade and the medium-term growth momentum looks quite solid. Geographical proximity, competitive labour costs, a reasonably sizeable manufacturing production capacity in the country vis-a-vis rising production costs in China imply that there exists an important opportunity for attracting Chinese investors in Bangladesh and building a productive bilateral economic partnership.
This chapter analyses emerging patterns and trends of Bangladesh-China trade and economic relationship and considers some options for shaping and strengthening the partnership in a way that should help Bangladesh exploit the market prospects in China and expand domestic supply-side capacity utilising Chinese investments. The chapter highlights various options for Bangladesh’s engagement with China in securing a bene cial bilateral trading arrangement in the path to LDC graduation and beyond. Having discussed various aspects of the Belt and Road Initiative, this chapter concludes that a deeper economic engagement based on judicious selection of investment projects and their e ective implementation will boost productive capacities in Bangladesh.
The extent of this research aims to demonstrate a Land Use/Land Cover (LULC) change over a coastal-industrial area of Sitakunda, part of Chittagong region in Bangladesh. Its reference information has included important drivers for this industrial area of 4.00 km2, that highlight its suburban growth that uncontrollably has disaggregated the rural landscape, in a period ranging from 2009 to 2022. Our geospatial analysis has started with the observation of the BM Container Warehouse, that has been recently interested by a dreadful fire.
As a testimony to its impressive economic performance, sustained over the past decades, Bangladesh is officially set to graduate from the group of least developed countries (LDCs) by 2024. Against overwhelming odds, it is a tremendous achievement, featuring international recognition of the country’s ongoing development transition. As an LDC, Bangladesh has been a bene ciary of certain international support measures (ISMs) that are generally not available to other developing countries. These include unilateral trade preferences and more favourable conditions or exibilities granted under various agreements of the World Trade Organization (WTO). Furthermore, the development partners have provided special attention and undertaken commitments to support LDCs with financial and technical assistance from which Bangladesh has also benefitted. The impending graduation is likely to have certain implications mainly for the export-oriented enterprises, as it gives rise to concerns about potentially sizeable economic costs due to the loss of access to various LDC-specific support measures. This chapter attempts to identify major issues arising from the changed circumstances associated with LDC graduation where the private sector has important stakes. It also discusses various policy options that can be pursued to ease the transition process into the post-graduation era. The graduation issues have been analysed under three broad likely implications: (i) preference erosion in international trade, potentially affecting exporting firms; (ii) reduced policy space, constricting the scope of supporting exporters and domestic market-oriented industries; and (iii) unfavourable impact on the prospects for development financing. While not exhaustive, these are likely to be the major avenues through which the private sector might get affected. This chapter assesses the relevant provisions in international trade agreements and development nancing to consider possible implications.
