Bangladesh should focus on building a very warm relationship with the European Union (EU) countries to export more and attract foreign direct investment as well.
A good relationship can change the future investment landscape of Bangladesh as entrepreneurs of the 28 European nations are very much eager to invest in the diversified fields of the country.
The EU is the largest export destination for Bangladesh, taking in goods worth nearly $18 billion in fiscal 2016-17. More importantly, 60 percent of garment items produced in Bangladesh are destined for the EU.
“So, a warm relationship of Bangladesh with the EU is a must,” said outgoing EU Ambassador in Dhaka Pierre Mayaudon, who also served as head of the EU delegation to Bangladesh over the past three years.
Mayaudon said Bangladesh was still eligible for the EU duty-free benefit scheme of Everything But Arms (EBA) as the government had already taken some good initiatives to bring reforms in the labour law and strengthen workplace safety.
The envoy suggested diversifying both markets and products for more export earnings.
For example, he said, both the government and private sector should come forward to utilise the potential of pharmaceuticals produced in the country.
EU-Bangladesh relations should not be confined only within suppliers and buyers, rather it should be diversified through more exports to EU and more investment from its member states to Bangladesh.
This is why EU Business Council was launched two years ago for warmer business relations.
The EU-Bangladesh business climate dialogue, held under the council, was bringing reforms in the economic sector to make the country more export and investment-friendly.
He said Bangladesh's commitment to amend the labour law by November was a very timely initiative as it would help improve labour rights in the country.
Mayaudon advised Bangladesh to improve its business environment so that it can become a suitable destination for foreign investors.
There should be changes in regulations, such as taxation, customs, licences and repatriation of dividends and sometimes capital. Bangladesh should drastically improve its ranking in the ease of doing business index, for it now stands 176th.
Bangladesh will need to meet necessary conditions to enjoy the GSP Plus facility once it graduates into a middle income country, as has been planned, in 2021.
It will need to ratify 27 core United Nations conventions, mostly covering areas of human rights, good governance, labour rights and environment.
Bangladesh will continue to enjoy, at least for some years, the GSP Plus facility even after graduating from a least developed country to a middle income one.
However, the envoy said the future economic growth of Bangladesh depends largely on a conducive political atmosphere and on the next general elections being held in a free, fair, transparent and inclusive manner.
Before leaving for his new assignment in Afghanistan, Mayaudon talked about his experiences, Bangladesh's political turmoils, future economic development and EU-Bangladesh trade in an interview with a group of journalists at his office in Dhaka recently.
While focusing on economic development and the political turmoil, Mayaudon said one difference between the political situation of 2014 and that of today was that the economic scenario was extremely positive in 2014.
The country might not be able to cope with any probable long term political upheaval, stemming from the upcoming general elections, due to volatility in the global economy.
However, the situation now was different.
He said in 2014, exporters, especially those of garments, were optimistic, resilient and confident and unfortunately the economic situation was not that well now.
There are frequent media reports saying that ready-made garment exports was facing stagnation while the amount of foreign direct investment was not meeting expectations, the diplomat said.
The prospects are still good as the new budget has already been placed with hopes of better economic growth. “It will happen and it will happen even better if the political scenario is conducive.”
The EU has been talking not only about the political and election issues of Bangladesh, but also of the country's future.
“The next election should not be in a partisan situation, the election should be free, fair, transparent and inclusive,” he said.
Mayaudon said the EU was confident that the initiative of the EC to call debate discussions with the civil society and political parties was obviously an attempt to find ways for holding a fair election.
Democracy, human rights and governance topped the EU agenda in Bangladesh and the EU would never miss any opportunity to address these crucial issues.
Mayaudon said when he arrived in Bangladesh three years ago, the political situation was quite volatile and he had witnessed quite widespread agitations in 2015. Now, the situation was much more peaceful. Regarding migrant workers and potential immigrants to the EU, he said the EU was open to all Bangladeshis, meaning those who wanted to go through legal channels.
Every year the EU nations issue 20,000 resident permits to Bangladeshis either to stay with families or work in Europe for a certain period of time.
The EU countries have been facing an influx of hundreds of thousands of migrants through the Middle East and especially from Afghanistan and Pakistan.
It is a fact that the EU nations have become more cautious about migrants as it raises a number of political, economic and social challenges at home.
Even till 2015, there was no Bangladeshi in the EU's list of illegal migrants. However, last year there were over 8,000.
The flow of Bangladeshi migrants seeking to enter Europe through this illegal channel has increased so much that it took just six months this year for the figure to cross that of last year.