The UK introduced its new Generalised System of Preferences (GSP), namely the DCTS, with effect from last January under which developing nations will enjoy duty-free benefits to the UK markets, except for arms.
“The scheme will support Bangladesh’s smooth transition from LDC status and take the UK-Bangladesh trading relationship to greater heights,” said British High Commissioner to Bangladesh Sarah Cooke yesterday.
It is more generous than GSP because it maximises benefits for developing nations and British buyers, she said. The DCTS will mostly support Bangladesh because the UK formed the scheme especially keeping the country in mind, she said in an event at her Dhaka residence.
In an online presentation, Sabiha Ahmed, trade preferences policy adviser at the Foreign, Commonwealth and Development Office of the UK, said Bangladesh would benefit from more generous rules of origin compared to the previous GSP.
The threshold for imported non-originating content increased from 70 percent to 75 percent for a large number of products, she said.
Bangladesh can source inputs from up to 95 countries without losing duty-free status by treating the inputs as originating in Bangladesh, she said.
The south Asian country will get the highest benefits of £315 million annually while Bangladesh, Pakistan and Cambodia will get a tariff cut worth £535 million jointly, she said.
Under the DCTS, Bangladesh will automatically move to an “Enhanced Preferences” tier in 2029, which will provide duty-free access to 98 percent of Bangladesh’s exports to the UK, including garments, said Ahmed. The DCTS is about boosting trade and prosperity and retention of the scheme is based on respect for human and labour rights though compliance with international conventions, she said.
