Bangladesh will receive duty-free access to Canada for garment exports until the year 2026 if everything remains in order. By then, Bangladesh will transition from being a Least Developed Country (LDC) to a developing nation, entering the realm of developed countries. This move is expected to boost the country’s textile and garment industry and create a more favorable trade environment between Canada and Bangladesh.
The Canadian government has made the decision to grant duty-free access to developing nations under the General Preferential Tariff (GPT) scheme. This scheme will provide tariff-free access for manufactured garments and other products based on relaxed rules of origin, prioritizing industrial labor standards and environmental compliance.
Mr. Faruque Hassan, the President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), stated that the Canadian Parliament passed a finance bill on June 8 that extended the GPT scheme until the end of 2024. Bangladesh has been enjoying complete tariff and quota-free access to Canada under the List-Development Country Tariff (LDCT) scheme since 2003. The LDCT scheme falls under the GPT scheme. GPT is renewed every ten years, with the current version set to expire at the end of 2024.
According to the Export Promotion Bureau (EPB), Canada was the 11th top destination for Bangladesh’s exports in the concluding fiscal year 2022-23. Exports to Canada during this period reached $1.72 billion, accounting for 3.10% of total exports, marking a 13% increase from the previous year.
This decision by Canada to provide duty-free access for garment exports until 2026 aligns with Bangladesh’s efforts to enhance its trade relations and create a favorable environment for the country’s industrial development.