LDC status gives Bangladesh duty-free access to the EU for all goods except arms and ammunition under the Everything But Arms (EBA) arrangement, according to the Commission’s announcement of 28 April 2026. Bangladesh, Lao PDR and Nepal will keep EBA preferences “at least until the end of 2029”, according to the Commission’s questions and answers on the new Generalised Scheme of Preferences (GSP), the EU’s tariff-cut scheme for developing countries, last updated on 28 April 2026. Garments made up US$39.35 billion, or 81.49 per cent, of Bangladesh’s exports in fiscal year 2024-25, according to export figures from the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), the industry’s trade body.

EU institutions reached a provisional agreement on the new GSP regulation on 1 December 2025, the Commission reported the next day. The Council was expected to approve the wording the Parliament adopted, according to a Council note of 30 April 2026 carrying that text, and the Commission’s questions and answers state that the rules will apply from 1 January 2027.

Outside EBA, GSP has two tiers. Under standard GSP, duties on textiles and apparel are cut by 20 per cent, according to the Parliament’s text of 28 April 2026. Under GSP+, the tier tied to human and labour rights, environmental and governance conventions, the same text suspends those duties. Conditions include ratifying all 32 listed conventions, with the Commission having identified no “serious failure to effectively implement” any of them. Bangladesh, Lao PDR and Nepal “have the opportunity to apply for GSP+”, the Commission’s questions and answers state.

Bangladesh became the first Asian country to ratify all 11 fundamental instruments of the International Labour Organization (ILO), the ILO announced on 20 November 2025, after ratifying three conventions following a labour law ordinance adopted on 17 November 2025.

Article 33 of the Parliament’s text requires the Commission to “remove the tariff preferences” under both standard GSP and GSP+ for textiles (section S-11a) and for apparel and made-up textiles (section S-11b) when one country’s share of those imports from all beneficiary countries exceeds 37 per cent (Annex IV). The rule does not apply to countries supplying 6 per cent or less of total EU imports of those products, or to EBA countries.

One estimate puts Bangladesh above both lines. A policy brief dated November 2023 for the International Growth Centre (IGC), a research centre at the London School of Economics, by Mohammad Abdur Razzaque and co-authors put Bangladesh’s share of extra-EU imports of section S-11b at more than 20 per cent and its share of GSP-covered imports of those products at “almost 50%”. The brief concluded that Bangladesh “can benefit from GSP+ preferential access” after graduation, but “its apparel exports will face MFN tariff rates in the EU”, the standard most-favoured-nation (MFN) duties, averaging close to 12 per cent. The IGC assessed the rules as then proposed; the Parliament’s text of 28 April 2026 keeps the 37 per cent threshold.

A May 2020 study by the World Trade Organization (WTO) and the Enhanced Integrated Framework (EIF), the dedicated capacity-building programme for LDCs, projected that graduation would cut Bangladesh’s exports by about US$5.37 billion, or 14.28 per cent. A later WTO and EIF country analysis put the fall in exports to the EU at US$5.28 billion, or 26.28 per cent. Both predate the new regulation.

If Bangladesh fails to secure GSP+, its garments are likely to face EU tariffs of nine to 12 per cent, the standard MFN rates, Newage Group Vice-Chairman Asif Ibrahim warned in a report by The Daily Star, a Bangladeshi English-language daily, published on 6 December 2025. On the IGC’s estimate, the 37 per cent threshold would apply those rates to garments even with GSP+. In the same report, BGMEA President Mahmud Hasan Khan said: “If the 6 percent and 37 percent thresholds are not removed, the Bangladeshi garment sector will not benefit.”

H&M, Inditex and Primark bought nearly US$6 billion of Bangladeshi garments in fiscal year 2023-24, according to an analysis of National Board of Revenue data by Prothom Alo, a Bangladeshi daily, published on 23 December 2024. VCA’s assessment is that a duty near 12 per cent would narrow Bangladesh’s landed-cost lead over suppliers that already pay full duties.

The UN Committee for Development Policy was reviewing the request, with a final decision likely by September 2026 subject to General Assembly approval, The Business Standard reported in February.

In VCA’s view, Bangladesh’s task before EBA ends is to limit the 37 per cent threshold’s reach, through negotiation or a trade agreement with the EU. For brands, the open question is how much Bangladeshi volume a 2030 order book can carry at full apparel duty.

Correction, 26 September 2026: This article was revised to correct (1) the headline, which cited an unsupported US$8 billion figure and said Bangladesh had “months” to act; (2) the claim that the EU’s GSP+ safeguard thresholds bar Bangladesh from GSP+: under the text the European Parliament adopted on 28 April 2026, the 37 per cent threshold removes standard GSP and GSP+ preferences on textiles and apparel (sections S-11a and S-11b) for non-EBA countries also above 6 per cent of total EU imports of those products, and does not bar a country from GSP+; (3) the “22 per cent” and “58 per cent” shares, which had no supporting source; (4) the “US$8 billion” WTO figure, replaced with the WTO and Enhanced Integrated Framework (2020) projection of US$5.37 billion, or 14.28 per cent; (5) the 32-convention requirement, now attributed to the new regulation; (6) the statement that the graduation date was fixed, adding Bangladesh’s request of 18 February 2026 to defer it; (7) the attribution of buyer data to BGMEA, which came from a Prothom Alo analysis of National Board of Revenue data; (8) the “US$47 billion” industry size, replaced with BGMEA’s fiscal 2024-25 figure; (9) the description of a 12-month ILO “implementation period”, which is the entry-into-force period of three newly ratified conventions; (10) the nine to 12 per cent tariff range, now attributed to its source with its condition. Unsourced statements on sourcing lead times, brand contingency plans, labour-cost rankings, government negotiating aims and the EU’s position were removed, and the source list was corrected.

Update, 26 September 2026: The Council approved the Parliament’s position on 22 May 2026, and the law was signed on 17 June 2026 as Regulation (EU) 2026/1395, published in the Official Journal on 22 June 2026. It applies from 1 January 2027, and its Annex IV keeps the 37 per cent threshold for sections S-11a and S-11b, according to the regulation’s text on EUR-Lex.

Update, 26 September 2026: In its crisis assessment of May 2026, the UN Committee for Development Policy noted that Bangladesh’s three-year request matched past practice but said “a shorter extension of the preparatory period would appear more conducive for a sustainable graduation”. On 21 July 2026 the UN Economic and Social Council recommended that the General Assembly act before 24 November 2026, and Bangladesh remained scheduled to graduate on that date, according to the UN LDC Portal, read on 26 September 2026.