Bangladesh’s economy grew faster in the last fiscal year than predicted, the government said yesterday. According to final reading, the gross domestic product growth was 7.11%, higher than provisional estimate, Planning Minister Mostafa Kamal told journalists after a meeting of the Executive Council of National Economic Committee (Ecnec). The provisional GDP growth estimate was 7.05%. The minister had already said the economy was growing faster due to uninterrupted political stability in the country. The Bangladesh economic growth was much higher than the World Bank forecast of below 7% for the last fiscal year. In reaction to this, he said: “Earlier the World Bank would not include Bangladesh in its economic development report because of being a minor economy.” The World Bank earlier expressed its surprise over the 7.05% provisional estimate of Bangladesh’s GDP growth for FY2016. However, the final GDP calculation is very close to the estimate of Asian Development Bank, which forecast that Bangladesh economy would grow 7.1% in the FY2016. Rejecting all criticisms against the GDP growth estimate, planning minister termed the achievement of crossing 7% economic growth as “glorious milestone” for the nation. “This is one step forward to the uplift of the nation in global arena as the GDP growth rate for the current fiscal year is also to be surpassed the 7% target,” Mostafa Kamal said. “To the best of my knowledge, this is the highest GDP growth rate achieved by the country after independence. However, I don’t exactly know 7.11% is the highest record of GDP growth after liberation or not,” he said. With this final reading of economic growth, Bangladesh broke its economic growth trap of 6% in decades. According to the Bangladesh Bureau of Statistics data, Bangladesh fared better in most sectors at constant prices during the last fiscal year. The data showed the agriculture sector witnessed a final growth of 2.79%, up from the fiscal year’s provisional estimate of 2.6% and 3.33% from a year earlier. The industry sector grew 11.09%, up from the fiscal’s provisional estimate of 10.10% and 9.67% from a year ago. However, the services sector growth is 6.25%, which is less than the fiscal year’s provisional estimate of 6.70% and up from 5.80% in the previous year. Among other sectors, fishing rose 6.11%, mining and quarrying 12.84%, manufacturing 11.69%, electricity, gas and water supply 13.33%, and construction 8.56%. The GDP size of the last fiscal year stood at Tk17,32,863 crore at the current market price, which was Tk15,15,802 crore a year ago. The gross national income was Tk18,326.49 crore.

The safety inspection by Accord, a platform of European buyers, and Alliance, another platform of North-American buyers, will end in June 2018. Accord and Alliance started the inspection in mid-2014 to improve electrical, fire and structural safety in Bangladesh RMG sector. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) will table the issue at its next board meeting on October 29, sources said. At the meeting, the board is expected to broadly discuss how it can maintain safety standard in the apparel industry through the adoption of an internally acceptable mechanism. Widespread public outcry over safety began after the Rana Plaza factory disaster that killed more than 1,135 workers and injured over 2,500 people on April 24, 2013. In 2014, the Accord on Fire and Building safety and Alliance for Bangladesh Worker Safety took a five-year initiative to improve fire, electrical and building safety standard in RMG factories from which their members source products. “After the expiry of Accord and Alliance inspections, it should be sustainable and there should be regular monitoring,” BGMEA Vice-President Mahmud Hasan Khan Babu told the Dhaka Tribune. “To this end, we have to have a nationally and internationally acceptable mechanism, which will look into the safety assessment after the inspection follow-up and make sure that the factory is being monitored as per the set parameter,” said Mahmud. He stressed the need for including all the parties like civil society members, rights groups and Bangladesh University of Engineering and Technology (Buet) to ensure a holistic approach, he added. “Coordinated structure, long-term monitoring and technological development are the key features to making the inspection a sustainable one,” Khondaker Golam Moazzem, additional research director of the Centre for Policy Dialogue, told the Dhaka Tribune. Involvement of the private sector in the process can be a big tool, while human resource development is needed, he added. “After the completion of Accord and Alliance inspections, the Department of Inspection for Factories and Establishments will continue, while the social compliance would be done by the buyers,” Syed Ahmed, DIFE inspector general, told the Dhaka Tribune. On the structural assessment he said it is not needed as the new building would be built as per the Bangladesh National Building Code and Rajuk will look into the structural issues as it is under its jurisdiction, said Ahmed. “There must have a specific authority, which would see to the issues as the industrialisation had reached the union level where there is no capacity to approve structural design and other safety issues, a labour ministry high official told the Dhaka Tribune, seeking anonymity. “I think, this could be under the Housing Department,” he said. He also suggested that the government should have approved engineering firms, which would carry out inspection as a third party and it should be certified by a law ensuring that it has the eligibility and capacity to assess structural safety. The government should train engineers on remediation process to continue with follow-up inspection, said Ahmed. “We are in confusion if the manufacturers will continue with the inspection and safety assessment programme after the tenure of the Accord and Alliance,” Sammilito Garment Sramik Federation President Nazma Akter.

The 12-member Trans-Pacific Partnership (TPP) that was signed earlier this year may not come into effect in its present form. Both the US presidential candidates—frontrunner, Democrat presidential nominee Hillary Clinton and Republican candidate Donald Trump—are opposing the treaty in its current form stating that it is against the US trade interests. Clinton is against the implementation of the pact since contesting for the polls, while Trump has consistently condemned the ratification of the treaty in his poll campaign. Unless both of them revoke their decision of not supporting the agreement, Vietnam which stands to gain enormously from the trade deal that spans 40 percent of the world’s economy will incur heavy losses. “My message to every worker in Michigan and across America is this: I will stop any trade deal that kills jobs or holds down wages, including the Trans-Pacific Partnership,” said Clinton during a campaign in Warren recently. She categorically said, “I oppose it now, I’ll oppose it after the election, and I’ll oppose it as president.”  Likewise, Trump has also taken a stance against the agreement. Reportedly, Trump who has been against the implementation of the treaty vouches to remove the US from the TPP membership if he wins the presidential polls. In a public address in Pennsylvania, Trump said, “The TPP would be the death blow for American manufacturing… It would further open our markets to aggressive currency cheaters.” Going by the statements of presidential nominees, it seems very likely that TPP will at least be revisited or reworked, if not altogether scrapped, after the new president takes over early next year. This will have a drastic effect on the textile and clothing sector of Vietnam, which expects duty on its exports to the US to reduce to zero from the current 17 per cent.

The US has extended its generalised system of preferences to a new product — travel goods — but despite being a strong player in the segment, Bangladesh will miss out on the opportunity as the trade benefit is currently suspended for the country. The US government last month included some travel goods like luggage, backpacks, handbags, and pocket goods such as wallets in the GSP mainly for least developed countries. The countries that will be benefitted from the move are Myanmar, Nepal, Cambodia and some African nations under the African Growth and Opportunity Act (AGOA), even though the countries are not strong in manufacturing these goods. US retailers and brands urged the United States Trade Representative (USTR) to offer GSP to more countries, as the existing countries enjoying the trade benefit cannot meet the demand for travel goods. Bangladesh has already applied to the USTR, the chief trade negotiation body of the US government, for the reinstatement of the trade privilege, which was scrapped in June 2013 on grounds of poor labour rights and workplace safety. But the Obama Administration did not give in, although Bangladesh has fulfilled almost all the 16 conditions attached to the revival of the GSP. Rick Helfenbein, president and CEO of American Apparel and Footwear Association, in a public hearing last week said although allowing GSP for travel goods to Myanmar and other AGOA countries is a good step, they are relatively small and incapable of supplying the goods as per required demand. Bangladesh is a major manufacturer of travel goods. “Keep in mind, this is a two-billion-unit industry but only 200,000 units in total came from AGOA…that’s not even 1 percent,” Helfenbein said in the public hearing. “Our observation is that the privilege that you have extended is not enough to make a significant industry difference and China, frankly, will continue its dominance over the travel goods industry,” he added. Helfenbein also urged the US government to extend the number of eligible countries for a realistic and meaningful opportunity to move production out of China. China owns 85 percent of the US travel goods markets, meaning 8.5 out of 10 items are made there, he said. Providing GSP travel goods eligibility will facilitate a more diversified supply chain, and will enable all these countries to expand their market share, thus supporting the goal of employment across the developing world, he added. Competitiveness of the developing countries is undermined unless they get duty-free access, and productivity in developing countries just cannot match the level in China, he said. Today, only a few GSP eligible countries have the ability to produce travel goods, particularly complex travel goods, he added. Many AGOA countries and LDCs simply lack the capacity to compete with China, he said. Given the choice, if other GSP countries are not allowed on the playing field, production will be slow or more likely, hesitant to move. Under the programme, 122 beneficiary developing countries (BDCs) export around 3,500 products duty-free to the US. The least-developed BDCs are eligible to export another 1,500 products duty-free. In 2015, exports that entered the US duty-free under the GSP programme from all countries totalled nearly $17.7 billion.