No EU plan to scrap GSP: Envoy

The European Union has ruled out possibility of cancelling trade preferences for Bangladesh following the country's January 5 parliamentary polls, EU Ambassador William Hanna said today.

"That continues to be the case, and we are not considering any trade measure at this stage," Hanna said while speaking to reporters in his office in Dhaka.

Bangladesh currently benefits from the most favourable condition on trade, as no taxes or tariffs is imposed on the country's goods and products entering the 28-nation bloc.

His comments came following a number of media reports that the EU might reconsider its Generalised System of Preferences (GSP) for Bangladesh the polls boycotted by BNP, the country's principal opposition party.

Following the elections, the European Union released a statement by Catherine Ashton, high representative of the EU for foreign affairs. Last week, the European Parliament passed a resolution on political development in Bangladesh.

"Neither document mentioned the question of trade. So we are not considering any change to the GSP at the moment," said Hanna.  

The government signed a tripartite agreement -- called Sustainability Compact -- with International Labour Organisation and the EU in Geneva in July last year, which has laid out a series of commitments for Bangladesh to improve labour and factory conditions.

When asked whether the EU would reconsider the GSP for Bangladesh should the country fail to meet the commitments, Hanna said: "The EU would probably review the progress the next couple of months. We will have to sit down with the government to see where we are."

"There has been progress in some areas, and there are some areas which are needed to be improved."

He said Bangladesh should specifically speed up its recruitment process for new inspectors.

"The recruitment of inspectors is not as quick as expected as committed in the agreement."

He said the database of information about factories has not yet been properly set up.

"There has to a transparent database so all the information would be there for people to see which factories have been inspected and when, what the inspectors find, what has been done about it and what measures have been taken."

Hanna said the GSP is important for Bangladesh as well as for Europe. "We want to continue to source from Bangladesh. Our companies are interested in continuing to invest. I think it is everybody's interests."

When asked about whether the EU is supporting the government following the elections where the bloc did not send observers, he said: "I do not think that it is a question of supporting the government."

"We have a long relationship with Bangladesh and we have been involved in assisting its development for a long while."

"Trade relation has become a key one over the decades. But the bedrock, the basis on which we work, is support for democracy and human rights. On those questions, we have expressed our concerns and we hope that there will be improvement in those areas."