Bangladesh hopes to gain from the suspension of the European GSP facility to Cambodia. Post GSP removal, buyers are expected to shift sourcing from Cambodia with rising prices of Cambodian products. And since there are similarities between readymade garment products produced in Cambodia and Bangladesh for export to the EU market, garment exporters in Bangladesh hope to increase export orders. Some orders have already shifted from Cambodia to Bangladesh in anticipation of buyers for months precluding EU suspensions of GSP. Bangladesh is the second largest exporter of readymade garments to the EU with GSP facility. However Bangladesh’ss gain from Cambodia’s lost orders would mainly comprise low cost items.

The EU has partly suspended the Generalised Scheme of Preference facility to Cambodia. The European bloc generally offers duty-free benefit to some least developed and developing countries under the Everything But Arms deal to boost trade and business. GSP suspension would put Cambodia’s apparel industry in a challenging situation as it would now need to pay 9 to 12 per cent duty on exports to the EU.