Apparel exporters will begin lobbying with major trading partners and blocs from next month to win their support for Bangladesh's efforts aimed at retaining duty benefits for six more years after the graduation of the nation from the group of least-developed countries.

Bangladesh is expected to lose its duty-free market access following its graduation to a developing country in 2026. But the European Union and the UK have already announced a three-year transition period to help the country graduate smoothly amid challenges posed by the coronavirus pandemic.  

But the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) wants a six-year transition period since apparel exporters are expected to face tough competition in the global markets after losing the duty-free trade benefit.

The trade body has long been seeking an extension of the transition period, but its lobbying has not been that strong. The outbreak of the Russia–Ukraine war and the dragging fallout of Covid-19 have prompted the association to rethink its strategy as consumers around the world have cut back on their consumption owing to a sharp rise in inflation.

"As part of the negotiation, we will meet the director-general for trade of the European Union, senior officials of Germany and many other major trading partners so they agree to the extension of the LDC-related trade benefit to at least six more years," said Faruque Hassan, president of the BGMEA, at a press conference at his office in Dhaka.

"We want to make the best of the LDC benefit as our trade has been affected severely owing to the fallout of the war and Covid-19."

Bangladesh, along with other LDCs, has been lobbying with the developed and developing nations and the EU and the World Trade Organisation (WTO), for an extension of the trade benefit to ensure a smooth transition for graduating LDCs.

During the 13th Ministerial Conference in Geneva in June, WTO members also recognised the importance of the extension. But they did not come up with a decision exactly when and how the benefit will be extended.

A decision on the extension may come at the 14th WTO Ministerial Conference in the UAE in 2024.

Hassan said he had already held talks with WTO Director-General Ngozi Okonjo-Iweala and sought 10 years as the transition period. But she advised them to lobby for a six-year transition period.

The government has already demanded an extension of the LDC-linked trade benefit for six years. It reiterated the call at the LDC-5 Plan of Action in Doha last week.

On a number of occasions over the last few years, the business community of Bangladesh said that the LDC graduation would not affect the business severely, citing the US market as an example.

Local exporters are performing strongly in the US markets despite a 15.62 per cent duty, on the back of a robust shipment of apparel items to the single largest export destination for Bangladesh.

However, the recent export trend of apparel shows that the preferential trade benefit is needed for the smooth continuation of shipments.

At the press conference, Hassan said the BGMEA was going to demand a duty-free market access for the apparel items made with US cotton and shipped to the US markets.

The BGMEA leader also said it has started working with the US government to address the issue of counterfeit goods through the introduction of a QR code for more traceability of the origin of goods.

It came after the US government lodged complaints with the government about the shipment of counterfeit products from Bangladesh.