EU envoy: Bangladesh must improve Ease of Doing Business ranking to attract more investment

 EU envoy: Bangladesh must improve Ease of Doing Business ranking to attract more investment

European Union Ambassador to Bangladesh Rensje Teerink Collected

In an exclusive interview, outgoing European Union Ambassador to Bangladesh Rensje Teerink discussed various issues, including trade, investment, the Rohingya, and the impact of the ongoing Covid-19 pandemic

As your tenure ends, how do you describe the current bilateral relationship between Bangladesh and the European Union? How could it be further enhanced?

My tenure here in an official capacity ends though my engagement with Bangladesh will continue. I will go back to Brussels to continue working on regional matters related to Asia. I hope that Bangladesh will play a prominent role in the wider geopolitical agenda that the EU is embarking on with countries in the Indo-Pacific. In that sense, I think you could say I could be an ambassador for Bangladesh in Brussels. 

The European Union has been a steadfast development partner of Bangladesh since 1973 and is proud to have been associated with this country’s socio-economic development. In 2001, a cooperation agreement was signed which extends to trade, economic and development cooperation, human rights, good governance, and the environment. European bilateral development aid to Bangladesh for 2014-2020 amounts to €655,000,000.

The Covid-19 pandemic has had a devastating impact across the social spectrum and the EU is aware that without incentives and other technical support, the economy cannot be rejuvenated. 

In December 2020, The European Union and Germany joined forces with the Government of Bangladesh to provide €113 million to safeguard the livelihoods of vulnerable workers in the garment and leather export-oriented industries, especially during the pandemic-induced lockdowns.   

To ensure labour rights and counter exploitation of workers, both male and female, EU and its member states launched Team Europe Initiative on Decent Work in June. The initiative responds to the global Decent Work Agenda and includes interventions in support of all four pillars of this agenda: employment creation, social protection, rights at work, and social dialogue.

In June, the European Union (EU) transferred EUR 42 million (Tk423 crore) to the Government of Bangladesh to support key national reforms in the education sector. With this grant, the EU recognizes and supports the government’s commitment to the development of human capital, the eradication of poverty and inequalities, along with its commitment to achieve the Sustainable Development Goals.

What are some new areas of cooperation through which both sides can benefit?

The arts and culture sector has been in doldrums due to Covid and this is an area where the EU can work with the Bangladesh government to create a local and overseas platform for artistes from all fields to showcase their work and be noticed. The EU already held a Bangladesh-EU Film Festival in June that was a resounding success. 

Also, Covid has left thousands of young people out of work. Therefore, skill development to earn a living in a changed social atmosphere is another area where the EU can provide assistance.

The Team Europe initiative on Green Energy Transition aims to support Bangladesh in building a power system that leads to maximum coverage of the country’s energy demand through renewable energy. It also intends to reduce CO2 emissions, energy consumption and demand through energy efficiency.

The current amount of activities of Team Europe Initiative on Green Energy Transition adds up to €930.6 million (around Tk9,378.7crore).

Bangladesh has a comprehensive development plan called the Bangladesh Delta Plan, 2100, focusing on economic growth, climate resilience and environmental conservation. The EU is providing support for the organization of the 1st Delta Conference. 

It is perceived that the EU is not helping Bangladesh as it should to fight Covid-19 pandemic, especially with respect to vaccines. What do you think?

Actually, while other nations are focusing on vaccines, the EU is giving more attention to support in rebuilding society ravaged by the pandemic. The EU has provided €24 million so far this year to the country’s national budget towards transitional government support (food or cash) for households; The EU will make €93 million available towards income support for workers in the ready-made garment and export sectors. This may pave the way for a social security system for workers in line with minimum international standards; and we are providing technical assistance to enable the government’s cash transfer system (Government-to-Person, or G2P) to cope with the increase in transactions caused by Covid-19. 

Do you think the EU and international community are doing enough to solve the Rohingya crisis? Do you see any end to this protracted crisis?

No crisis, irrespective of how intractable it appears, is beyond a solution. To resolve any problem, the first requirement is the right atmosphere plus a desire to find a morally acceptable way through constructive dialogue. Unfortunately, Myanmar has been in ferment since the military coup and the country is seeing mass protests. Any solution on the Rohingya complexity must come from Myanmar and the international community should sustain its pressure on Myanmar through sanctions and embargoes. Since the coup, EU sanctions have frozen assets or applied travel bans on 21 military and civilian members of Myanmar’s junta. European citizens and companies are also barred from making funds available to those sanctioned.

The bloc’s last round of sanctions in April targeted military-owned conglomerates Myanmar Economic Holdings Limited (MEHL) and Myanmar Economic Corporation (MEC), barring EU investors and banks from doing business with them.

In February, the European Union announced €39 million ($47.4 million) in humanitarian aid to address the needs of Rohingya in Myanmar and Bangladesh.

The bloc will allocate €24.5 million ($30 million) and €11.5 million ($14 million) to humanitarian organizations working in Bangladesh and Myanmar respectively.

Are you satisfied with present trade volume between Bangladesh and EU? How can it be increased?

Under the EU’s Generalised System of Preference (GSP) Bangladesh enjoys zero duty for up to 7,200 different products. Major Bangladeshi exports include garments, frozen food, agro-products while imports from EU include machinery and transport. 

Trade can increase with diversification, not only through products but through skills. Bangladesh now has world-class talents in IT, film making, gastronomy and fine arts. These areas need to be explored more once the Covid threat dissipates. 

Is EU investment in Bangladesh satisfactory? What more does Bangladesh need to do to attract more investment from the bloc?

For Bangladesh to attract more investment, the first priority is to improve the Ease of Doing Business ranking. In 2020, Bangladesh placed 168 out of 190 countries in World Bank’s Doing Business ranking. India, Bangladesh’s neighbour, ranked 63. 

Bangladesh needs to address the endemic issues of unethical financial transactions, bureaucratic bottlenecks and sharp practice to do better in the rankings and attract more investment. This country has hardworking, dedicated people, the manufacturing cost is still low and investors have every reason to choose Bangladesh.  

As Bangladesh graduates from LDC, is GSP Plus privilege to the EU market a done deal?

No, it’s not the end of the road for Bangladesh. Bangladesh is the single largest beneficiary of the Everything but Arms, EBA trade preferential scheme among the 48 EBA beneficiary countries, allowing €18 billion worth of Bangladeshi products to be imported on a tax free basis, resulting in the saving of €2 billion.

As an unwavering development partner of Bangladesh, the EU believes that in times of crisis, like the one the world is passing through at the moment, dialogue, negotiations and empathy are essential and it’s in this spirit that we look forward to addressing the issue of trade privileges once Bangladesh graduates from LDC status.

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