[🇧🇩] Bangladesh and European Union

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https://www.dhakatribune.com/bangladesh/foreign-affairs/421339/envoy-eu-sees-bangladesh-as-growing-strategic

Envoy: EU sees Bangladesh as growing strategic partner
EU ambassador says bloc seeks deeper trade and investment ties with Bangladesh ahead of LDC graduation

Ambassador and Head of the EU Delegation to Bangladesh, Michael Miller. Photo: Collected

The European Union views Bangladesh as a partner of growing strategic importance and wants to elevate ties beyond the traditional donor-recipient relationship, its ambassador said on Sunday.

Speaking at the Bay of Bengal Conversation in the capital, the Ambassador and Head of the EU Delegation to Bangladesh, Michael Miller, said the bloc was looking at Bangladesh with a "different level of ambition" British High Commissioner to Bangladesh Sarah Cook on Sunday met Prime Minister Tarique Rahman and discussed the overall state of Bangladesh-UK relations, including prospects for greater trade and investment, economic cooperation and human resource development.

The meeting was held at the Prime Minister’s Office in the Cabinet Division of the Bangladesh Secretariat, said a press release issued by the PM’s Press Wing.

During the meeting, they exchanged views on various issues of bilateral relations and matters of mutual interest.

They stressed the importance of further strengthening and broadening the longstanding and friendly relations between Bangladesh and the UK.

The country approaches graduation from least developed country (LDC) status.

"We are looking at Bangladesh as a partner of growing strategic importance," he said while sharing his thoughts through the "Diplomatic Lens" at the international conference.

He described Bangladesh as a country of "scale, ambition and consequence", saying its importance extended across South Asia, the Bay of Bengal and the wider Indo-Pacific.

The envoy said the relationship was moving beyond the traditional donor-recipient framework that had characterized an important part of Bangladesh-EU cooperation over the past decades.

He acknowledged the contribution of the EU's Everything But Arms (EBA) trade preference scheme to Bangladesh's development progress, including its role in expanding employment opportunities for millions of people, particularly women.

As Bangladesh prepares for LDC graduation, he said the EU was ready to work with Dhaka to ensure a smooth and successful transition while exploring the prospect of a future Free Trade Agreement (FTA).

The envoy said the offer to explore such an agreement with a country yet to graduate from LDC status was unprecedented for the European Union.

"The key message is: we are ready to match the level of speed and ambition demonstrated by Bangladesh," he said.

He, however, said the two sides would first have to determine whether sufficient common ground existed for a balanced, reciprocal and mutually beneficial agreement.

The ambassador stressed the importance of ensuring a level playing field for businesses under any future trade arrangement.

He said the success of deeper Bangladesh-EU economic engagement would depend on strong and accountable institutions, rule of law, labour rights, human rights, environmental protection and good governance. "These issues are central; they are not peripheral," he said.

The EU envoy said Bangladesh was navigating an important phase in its development journey amid LDC graduation, political transition, economic pressure, climate vulnerability and an increasingly complex external environment.

He said stronger institutions, independent oversight mechanisms and predictable and inclusive decision-making would help Bangladesh withstand geopolitical, geoeconomic, climate, social and technological pressures.

The ambassador also underlined the importance of constitutional reform, greater political consensus, skilled human resources, green growth, diversified exports and reliable infrastructure for the country's future development.

"If this country is to attract investment, both foreign and domestic, and to create meaningful jobs for its youth, it will require strong institutions and oversight mechanisms," he said.

He said critical infrastructure needed to be safeguarded while data management should remain transparent.

Highlighting the EU's investment approach, the envoy said European engagement sought to combine investment with technology, international standards, long-term capital and innovation.

He cited the Laldia Container Terminal in Chittagong and green bond initiatives as examples of areas where European engagement could bring additional value.

The ambassador said the EU could also share its experience in public administration and political and economic transition with Bangladesh.

He said Europe itself had gone through major transformations from autocratic systems towards democratic governance and modern economic institutions.

The EU, he said, wanted to help Bangladesh navigate increasing global competition while remaining "open, sovereign, resilient and connected".

Earlier in his speech, the envoy said the EU's own response to growing global uncertainty had been to strengthen its strategic autonomy while remaining open, cooperative and committed to international law and multilateralism.

He said the EU sought partnerships based on mutual interest, respect, fairness and a level playing field, while offering rules-based trade, sustainable investment and cooperation in climate, connectivity, digital transformation and human development.

The Bay of Bengal Conversation is being held at the Pan Pacific Sonargaon Hotel in Dhaka.​

 

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https://www.dhakatribune.com/opinion/editorial/421426/deeper-relations-cannot-be-built-on-trade-alone

Deeper relations cannot be built on trade alone
We need stronger institutions, skilled workers, diversified exports, reliable infrastructure, and a predictable business environment if we are to compete successfully in a more demanding global market

Tribune EditorialTribune Editorial

The European Union’s recognition of Bangladesh as a partner of growing strategic importance is a welcome development. More importantly, the willingness to move beyond the traditional donor-recipient relationship signals that Bangladesh’s place in the international arena is changing.

Speaking at the Bay of Bengal Conversation, EU Ambassador Michael Miller said the bloc was ready to match Bangladesh’s “speed and ambition,” including by exploring a future free trade agreement.

With Bangladesh preparing for LDC graduation, stronger and more reciprocal economic ties with the EU could be crucial for protecting exports, attracting investment and supporting long-term economic growth.

The EU has already played an important role in Bangladesh’s economic development through the Everything But Arms trade preference scheme, which has helped expand employment and opportunities, particularly for women. As those arrangements evolve after graduation, securing sustainable market access must remain a major priority for Dhaka.

But deeper relations cannot be built on trade alone: The EU has rightly emphasized the need for accountable institutions, rule of law, labour and human rights, environmental protection, and good governance.

These are not external conditions that Bangladesh can simply set aside; they are essential foundations for attracting investment and building a resilient economy.

Bangladesh should therefore approach this emerging partnership with confidence, but also with seriousness. We need stronger institutions, skilled workers, diversified exports, reliable infrastructure, and a predictable business environment if we are to compete successfully in a more demanding global market.

A potential FTA with the EU could open important doors, but negotiations must ensure that Bangladesh’s interests are protected and that businesses, particularly smaller ones, are equipped to meet international standards.

The EU’s message is encouraging: Bangladesh is increasingly being viewed as a country of strategic consequence, not merely as a recipient of assistance. Now Dhaka must demonstrate that it is ready for that role.

A mature partnership must be based on mutual interests, shared responsibility, and tangible results.​

 

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Treat EU FTA terms as scope for reform, not constraints

Bangladesh should treat the requirements for signing a free trade agreement (FTA) with the European Union (EU) as scope for reform rather than as constraints, economists and foreign trade specialists say.

www.thedailystar.net

Treat EU FTA terms as scope for reform, not constraints

Trade experts say

Bangladesh should treat the requirements for signing a free trade agreement (FTA) with the European Union (EU) as scope for reform rather than as constraints, economists and foreign trade specialists say.

The requirements include stricter compliance with international standards on labour laws, human rights, environmental protection, climate commitments and good governance. Apart from the reforms, meeting these conditions would also raise compliance costs for businesses.

“With an FTA with the EU, some industries may face smart competition. You have to accept that. But other sectors will have more opportunities,” said Professor Wahiduddin Mahmud, an economist and former adviser to the interim government.

At a seminar in Dhaka yesterday, the economist said improving the business environment, export logistics, investment climate, environmental standards and transparency in trade and foreign investment policies would be necessary regardless of whether Bangladesh signs FTAs, because the global trade picture is changing.

The programme was organised jointly by the Bangladesh Institute of International and Strategic Studies (BIISS) and Friedrich-Ebert-Stiftung (FES) Bangladesh.

The EU is the biggest destination for Bangladeshi exports, thanks to duty-free and quota-free access. Exports to the bloc were more than $19 billion in fiscal year 2025-26. As Bangladesh prepares to graduate from least developed country (LDC) status, the government is in talks with the EU about a free trade deal.

Professor Wahiduddin said that FTA negotiations require rigorous economic research, although economic modelling alone cannot capture all the uncertainties arising from changing trade patterns and the emergence of new export products.

Bangladesh also needs a dedicated team of negotiators with expertise in international trade law, trade economics and World Trade Organization rules, supported by effective coordination among ministries, he said.

On the potential benefits, he said Bangladesh has fewer concerns than India over tariff cuts because it does not have some of the machinery industries that India sought to protect in its negotiations with the EU.

However, he warned that high general tariff rates can lead to trade diversion, where imports shift from cheaper sources such as China to relatively expensive EU suppliers. The net benefits of an FTA will therefore depend on whether trade creation outweighs trade diversion.

The economist said Bangladesh should gradually reduce its overall tariff rates, noting that Vietnam has cut its general rates to around 7 percent to 8 percent while those in Bangladesh are considerably higher.

He also called for FTA negotiations to extend beyond the EU to Association of Southeast Asian Nations (Asean) countries and regional economies such as Malaysia.

Nazneen Ahmed, executive director of the think tank Centre for Policy Dialogue (CPD), said Bangladesh will permanently lose duty-free and quota-free access to the EU market as it approaches LDC graduation, with a final extension until 2029 and a transition period until 2032.

Securing the EU preferential scheme GSP Plus remains highly uncertain, she said.

Competitors such as India already have agreements with the EU, said Nazneen. Bangladesh should not treat an FTA as an isolated goal.

“The preparations it demands, including the green transition, compliance with carbon trade rules, labour standards and institutional reforms, are vital for broader economic growth and poverty reduction.”

She added that the focus must shift from questioning why Bangladesh should pursue an FTA to how to negotiate effectively by acting proactively, using modern analytical tools and aligning trade talks with a national agenda for institutional transformation.

Syed Muntasir Mamun, director general of the International Trade, Investment and Technology Wing at the Ministry of Foreign Affairs, said future trade negotiations must account for coming technological disruption, including artificial intelligence, quantum computing and advanced automation, which will transform global communication and commerce.

He added that Bangladesh should explore innovative trade-backed regimes, monetary swaps and equity-driven financial structures to facilitate future trade and investment.

Baiba Zarina, deputy head of the EU delegation to Bangladesh, said the EU increasingly sees Bangladesh not only as a beneficiary of preferences but as a strategic economic partner.

“We offer open, rules-based trade. We offer investment-making standards, transparency, and sustainability. We offer expertise that supports stronger institutions and greater resilience.”

“I want to reaffirm that the European Union approaches this request of Bangladesh to seek and have an FTA negotiation with openness and seriousness,” she said.

The EU is also very encouraged by the political commitment the current government has shown so far in addressing obstacles to trade and investment, she added.

Sharf Uddin Ahmed Choudhury, secretary of the Ministry of Commerce, said the ministry must coordinate trade policy and negotiations across government, academia and industry. The success of an FTA should be measured by export diversification, productive employment and sustainable economic resilience.

M Nazrul Islam, secretary (Bilateral-East and West) at the Ministry of Foreign Affairs, said the three-year extension for LDC graduation provides a key window to advance FTA negotiations, prepare for post-LDC arrangements such as GSP Plus and tackle structural problems that affect exports.

He said market access alone is not enough without competitive domestic industries, and Bangladesh must improve its business environment, infrastructure, customs, labour rights, environmental compliance and governance.

Mahfuz Kabir, research director of BIISS, presented a paper at the event, which was moderated by Mostafa Abid Khan, chief executive of the Bangladesh Foreign Trade Institute. Md Mashequr Rahman, acting director general of BIISS, Felix Gerdes, resident representative of FES Bangladesh, and Masrur Reaz, chairman of Policy Exchange Bangladesh, also spoke at the event.​

 

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Bangladesh begins preliminary FTA negotiation with EU

Bangladesh has opened preliminary talks with the European Union (EU) on a possible free-trade agreement (FTA) to keep preferential access to its largest export market after LDC graduation. The two sides held their first pre-negotiation meeting in early November. The meeting followed the appointmen

thefinancialexpress.com.bd

FORESIGHT ON POST-LDC GRADUATION TRADING ERA
Bangladesh begins preliminary FTA negotiation with EU
Both parties appoint chief negotiators to assess scope of deal

Bangladesh has opened preliminary talks with the European Union (EU) on a possible free-trade agreement (FTA) to keep preferential access to its largest export market after LDC graduation.

The two sides held their first pre-negotiation meeting in early November. The meeting followed the appointment of chief negotiators by Bangladesh and the European Commission to assess the scope and prospects of a deal, commerce ministry officials said.

Bangladesh named an additional secretary of the commerce ministry as its chief trade negotiator about six weeks ago.

The Commission's Directorate-General for Trade and Economic Security (DG Trade) has designated a director-level official to lead its side.

A senior commerce ministry official, speaking on condition of anonymity, told The Financial Express that the government wanted to conclude an FTA "as quickly as possible so that exporters would not lose preferential access when the current benefits expire".

The early rounds are meant to identify areas of mutual interest and sketch out a possible framework for a deal that protects Bangladesh's export competitiveness in Europe.

Officials familiar with the proceedings said the EU was also keen to move ahead and complete the necessary procedures before Bangladesh's preferential access under the Everything But Arms (EBA) scheme ends.

The initiative has gained urgency as the country prepares for its post-LDC transition. The United Nations General Assembly recently gave Bangladesh three more years to prepare for graduation from the least-developed-country status, forwarding the date to November 24, 2029.

Under the EBA scheme, the EU gives duty-free and quota-free access to all products bar arms and ammunition from eligible LDCs. Bangladesh is the scheme's largest beneficiary.

Bangladeshi exports worth around €19 billion benefited from it in 2024, with a preference utilisation rate of 96 per cent, according to the European Commission.

The country will forfeit EBA eligibility after exit from the world's poor-country club. A transition period will let it keep the existing preferences for a limited time.

Keeping these benefits is a major concern for export-oriented industries, especially the readymade-garment sector, which depends heavily on the European market.

The EU's Generalised System of Preferences Plus (GSP+) scheme is another option. However, qualifying for it would mean meeting the bloc's strict conditions on international conventions, labour rights, human rights and environmental protection.

Dr M Masrur Reaz, chairman and chief executive officer of Policy Exchange Bangladesh, says preliminary discussions have begun. Both sides, however, would need to carry out detailed assessments before formal negotiations could start. He notes that several countries are seeking trade talks with the EU, and those with larger trade volumes with the bloc are likely to get priority.

"Bangladesh is on the right track, as it is also assessing the preparedness of the other side for starting negotiations," he says.

He has warned that formal talks could be delayed if Bangladesh did not show enough seriousness and preparation. "If we cannot demonstrate the required level of seriousness in the negotiations, that might delay the formal process."

Dr Mostafa Abid Khan, chief executive officer of Bangladesh Foreign Trade Institute (BFTI), has said the country needs thorough preparation before entering formal negotiations.

He said the EU was likely to stress intellectual-property rights, labour standards and environmental protection. It would also seek greater market access for its automobile industry and services sector.

"The bloc has held a strict line on rules of origin in its past trade negotiations," he said. It might not let Bangladesh export apparel duty-free unless the products meet its two-stage value-addition (double transformation) requirement, an issue that would need careful handling at the table.

He estimates that the pre-negotiation phase alone could take around a year.

At an event, Baiba Zarina, deputy head of the Delegation of the European Union to Bangladesh, said the EU increasingly viewed Bangladesh as a strategic economic partner rather than merely a beneficiary of trade preferences.

"We offer open, rules-based trade. We offer investment, high standards, transparency and sustainability. We offer expertise that supports stronger institutions and greater resilience," she said.

She reaffirmed the EU's willingness to consider Bangladesh's request. "I want to reaffirm that the European Union approaches Bangladesh's request to seek an FTA negotiation with openness and seriousness."

She added that the EU was encouraged by the current government's political commitment to removing barriers to trade and investment.

The EU is Bangladesh's largest trading partner, accounting for 21.5 per cent of the country's global merchandise trade in 2025, according to the European Commission.​