The EU Heads of Mission said improvement in customs tariffs and procedures will help Bangladesh create a positive investment climate which in turn would contribute to ensuring sustainable economic growth.
The issues were discussed at the 6th plenary of EU-Bangladesh Business Climate Dialogue at the Commerce Ministry.
Commerce Minister Tipu Munshi chaired the dialogue while it was co-chaired by Secretary Commerce Dr Md Jafar Uddin and EU Ambassador to Bangladesh Rensje Teerink.
The dialogue was attended by all eight EU Heads of Diplomatic Missions in Dhaka - Denmark, France, Germany, Italy, the Netherlands, Spain, Sweden, and the United Kingdom.
The Commerce Minister said many problems have been solved through discussions after identifying those problems and both sides have been benefited. “It’s a continuous process.”
He said Bangladesh expects the EU will provide GSP+ trade benefits to Bangladesh as it will lose the existing trade benefits after three years of becoming a developed nation.
As a Least Developed Country (LDC), Bangladesh currently enjoys the duty-free access to the European market under the Everything But Arms (EBA) initiative.
GSP+ is a special incentive arrangement for sustainable development and good governance and it grants full removal of tariffs on over 66 percent of EU tariff lines.
Numerous government authorities, including the Bangladesh Investment Development Authority (BIDA), the National Board of Revenue (NBR) and Bangladesh Bank as well as representatives from EU private sector participated in the dialogue, according to the EU.
The EU Heads of Mission here considered that there is an urgent need for the government of Bangladesh to action in order to facilitate more EU import to Bangladesh.
Currently, various tariffs and para-tariff barriers hinder quality European products from entering into Bangladesh.
The Heads of Missions suggested that while there is no shortage of law or policies in Bangladesh to regulate trade and investment, the main difficulty was due to the lack of their effective enforcement.
Among other issues, the Ambassadors stressed the need for full and proper implementation of bilateral double taxation avoidance agreements, removing investment cap in the services sector, and upgrading the delivery of services at Chittagong port and Dhaka airport.
They asked for having a predictable and transparent taxation and VAT regime as well as an improvement in Bangladesh’s judicial system to ensure immediate and effective enforcement of contracts on which Bangladesh ranks next to last globally, as reported by the World Bank’s Doing-Business Index 2020.
The next plenary is scheduled for July 2020.
The EU-Bangladesh Business Climate Dialogue was initiated in May 2016 with the aim to jointly remove impediments that obstruct EU trade and investment in Bangladesh.
The EU is Bangladesh’s number one trading partner and the second largest source of FDI to Bangladesh.
Bangladeshi exports to the EU amounted to about €18 billion in 2018, while the EU exports to Bangladesh were to the tune of €3.5 billion, according to EU Embassy in Dhaka.