PRELIMINARY FINDINGS AND INTRODUCTION TO THE CASE STUDY OF BANGLADESH

Transcription

1 PRELIMINARY FINDINGS AND INTRODUCTION TO THE CASE STUDY OF BANGLADESH Stakeholder Outreach Workshop Dhaka, Bangladesh Tuesday February 7, 2017 and executed by DEVELOPMENT Solutions. Any views expressed are those of the consultant and do not represent an official view of the Mid-term Evaluation European of the EU Union GSP

2 Content Case study approach Bangladesh-EU Trade Impact of the EU s EBA Economic impact Social impact Environmental impact Human rights impact Standard GSP or GSP+ beneficiary Conclusions and next steps

3 Case Study Approach Quantitative and qualitative assessment of main indicators on: Economic impact in particular on economic development Social impact in particular on poverty reduction and distribution of gains Environmental impact Human rights impact Unintended consequences of the EBA Stakeholder input and contributions National workshop in Bangladesh Interviews and meetings Stakeholder questionnaire

4 Summary overview of the 3 GSP arrangements Beneficiaries Number of beneficiaries Standard GSP GSP+ EBA low or lowermiddle income countries vulnerable Standard GSP beneficiaries in terms of export diversification and import volumes LDCs Non-sensitive goods duty suspension duty suspension duty suspension Sensitive goods - specific duty - ad volorem duty duty reduction: - 30 per cent per cent duty suspension duty suspension

5 Analytical questions What is the economic, social and environmental impacts of EBA? What is the impact of EBA on economic development? What is the impact of EBA on poverty reduction? What is the impact of EBA on the distribution of gains? Are there any unintended consequences of EBA?

6 Bangladesh-EU Trade GSP beneficiary since 1971 and EBA beneficiary since 2001 Main beneficiary of the EU s EBA 69.1 per cent of all EBA exports to the EU EU is the main export destination for Bangladeshi exports 46.7 per cent of total exports in 2015 EUR 15.1 billion in value in 2015 Main export products: Clothing and textile Fish and crustaceans (shrimps) Vehicles other than railway or tramway Raw hides and skin, leather Tobacco Bangladesh s exports to the EU in million EUR Source: EuroStat

7 In million of euros Economic impact of the EBA Increase in EBA exports to the EU in terms of value Low diversification focus on RMG RMG products represent more than 90% of all exports to EU Top 10 exports account for the 99% of all exports to EU Bangladesh RMG exports to EU 9,000 8,000 7,000 6,000 91% 91% 90% 90% 5,000 4,000 3,000 2,000 1,000 89% 89% 88% 88% 87% HS61: Apparel (knitted or crocheted) HS62: Apparel (not knitted or crocheted) RMG share in total BGD exports to EU % Source: EuroStat

8 share in exports Millions of euros Economic impact of the EBA Non-apparels Shrimp, bicycles, leather, tobacco Non-RMG exports are growing in value terms but they are loosing importance Sanitary and phytosanitary requirements and technical barriers to trade Main non-apparels exports to EU 4% 4% 3% 3% 2% 2% 1% 1% 0% Fish and crustaceans Vehicles other than railway Raw hides and skins and leather Tobacco Articles of leather Main non-apparels exports to EU Fish and crustaceans Raw hides and skins and leather Vehicles other than railway Tobacco Articles of leather Source: EuroStat

9 Utilisation Rate 120% 100% Change in RoO 80% 60% Revised GSP scheme 40% 20% 0% Source: EuroStat HS61: Apparel (knitted or crocheted) HS62: Apparel (not knitted or crocheted) HS63: Textiles HS64: Footwear HS65: Fish and crustaceans HS87: Vehicles HS41: Raw hides, skins and leather HS24: Tobacco HS42: Articles of leather HS53: Vegetable textile fibres Weighted average

10 Share in total EU imports Growth Competition with Other Beneficiaries Reduced number of beneficiaries: Unlikely to have any significant effect Differing export profiles Increased competition from Pakistan and Vietnam Duty suspension as GSP+ beneficiary Vietnam and Pakistan have increased their share in EU market at faster rate than BGD also indicators of diversification need to be assessed Share and growth in share of RMG exports to the EU 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Source: ComTrade % 60% 50% 40% 30% 20% 10% 0% -10% -20% Bangladesh Pakistan Viet Nam Cambodia Sri Lanka Bangladesh Pakistan Viet Nam Cambodia Sri Lanka

11 Social Rights in Bangladesh Free and compulsory primary education Improvement of quality and access to education Large share of Bangladeshi workforce remains undereducated Extensive health infrastructure in public and private sector Reduced child and maternal deaths, increased immunisation coverage and survival from infectious diseases Institutional obstacles, competency overlap, shortage of qualified staff and underfinancing Labour is one of the main production factors Improving labour rights since 2013

12 Social Impact in the RMG Sector RMG sector employs 4.2 million workers and indirectly supports 40 million Bangladeshi 55 per cent of the workers are female Positive effect on empowerment, household income and domestic violence Work safety conditions are improving since the Rana Plaza disaster in 2013 Promising developments to guarantee the right to association Since 2013 a significant increase of trade unions Online registration of trade unions since March 2015 Helpline to report and resolve workplace grievances since Number of trade unions in the RMG sector Source: EU

13 Environment in Bangladesh Rapid urbanisation and economic growth Affects air, water and soil quality, deforestation, waste generation and climate change Increasing CO2 emissions and air pollution Per capita CO2 emissions more than doubled in last two decades Vehicle and industry emissions Problematic waste management in urban centres Poor industry waste management Underfinanced and outdated Increasing deforestation Increased demand for housing and land for agricultural activities Vulnerability to climate change (sea level rise and extreme volatility) Rising sea levels and increasing number of natural calamities

14 Environmental Impact of RMG Sector High waste generation in RMG centres in Chittagong, Khulna, around Dhaka and Narayanganj city In Naranyanganj city 120 to 125 tons of waste is generated on a daily basis Chemical pollutants in the factories waste and waste water have detrimental environmental effects On rivers and the coastal and marine environment through waste water On the soil through land filling On the air and atmosphere in the cities Sewing 3% Other 4% Caused by improper waste management and lack of enforcement of regulations Knitting 13% Dyeing 21% Cutting 59% Source: Md. Masud Alom. Effects on Environment and Health by Garments Factory Waste in Narayanganj City (2016)

15 Environmental Impact of Shrimp Cultivation Affects soil and water quality Changes chemical composition of soil texture and water quality Extensive sediment accumulation Affects land use Mangroves, agricultural land and rice fields are being used Deforestation in coastal areas Affects flora and fauna diversity Lack of sustainable pond management techniques Lack of enforcement of existing regulations Lack of training and skill development mechanisms for farmers

16 Human Rights in Bangladesh EU can withdraw trade preferences in case of serious and systematic violation of the principles laid down in the core UN and ILO conventions Bangladeshi signed up to human rights conventions and proclaims human rights inalienable, universal and fundamental Violations by the criminal justice system Right to life, liberty and security Right to be free from arbitrary arrest Violations of right to freedom of expression Human rights organisations raised concern about state censorship and the constrained media environment Gender-based violations of human rights Disadvantages in multiple aspects of life: access to health services, economic opportunity, political participation and control of finances

17 Standard GSP or GSP+ Beneficiary Graduation from LDC classification may be achieved by Steady economic growth at roughly 6 per cent per year BGD may face a reduction in the preferential tariffs to EU if only eligible for Standard GSP GSP+ could be an option to extend the duty free access to the EU market: Ratification of GSP+ covered conventions on human rights, labour rights, environmental protection and good governance Implementation of GSP+ covered conventions Improvement of Labour standards Security Democracy Environmental standards Freedom of expression

18 Thank you for your attention! WE WELCOME YOUR INPUT Stay up to date on the evaluation process GSP Evaluation and executed by DEVELOPMENT Solutions. Any views expressed are those of the consultant and do not represent an official view of the Mid-term Evaluation European of the EU Union GSP